Value stocks typically trade at discounts to the broader market, offering patient investors the opportunity to buy businesses when they’re out of favor. The key risk, however, is that these stocks are usually cheap for a reason – five cents for a piece of fruit may seem like a great deal until you find out it’s rotten.
Identifying genuine bargains from value traps is something many investors struggle with, which is why we started StockStory - to help you find the best companies. Keeping that in mind, here are three value stocks with little support and some other investments you should consider instead.
Clarus (CLAR)
Forward P/E Ratio: 17.7x
Initially a financial services business, Clarus (NASDAQ: CLAR) designs, manufactures, and distributes outdoor equipment and lifestyle products.
Why Are We Out on CLAR?
- Sales tumbled by 4.9% annually over the last two years, showing consumer trends are working against its favor
- Cash burn makes us question whether it can achieve sustainable long-term growth
- Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value
At $3.35 per share, Clarus trades at 17.7x forward P/E. To fully understand why you should be careful with CLAR, check out our full research report (it’s free for active Edge members).
Teleflex (TFX)
Forward P/E Ratio: 7.5x
With a portfolio spanning from vascular access catheters to minimally invasive surgical tools, Teleflex (NYSE: TFX) designs, manufactures, and supplies single-use medical devices used in critical care and surgical procedures across hospitals worldwide.
Why Are We Cautious About TFX?
- Weak constant currency growth over the past two years indicates challenges in maintaining its market share
- Free cash flow margin shrank by 12.1 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
Teleflex is trading at $109.45 per share, or 7.5x forward P/E. Read our free research report to see why you should think twice about including TFX in your portfolio.
PROG (PRG)
Forward P/E Ratio: 8.3x
Evolving from its origins as Aaron's, Inc. before rebranding in 2020, PROG Holdings (NYSE: PRG) provides alternative payment solutions including lease-to-own options and second-look credit products for consumers who may not qualify for traditional financing.
Why Do We Pass on PRG?
- Flat sales over the last five years suggest it must find different ways to grow during this cycle
- Earnings per share fell by 6.2% annually over the last five years while its revenue was flat, showing each sale was less profitable
- Products and services are facing significant credit quality challenges during this cycle as tangible book value per share has declined by 12.9% annually over the last five years
PROG’s stock price of $27.88 implies a valuation ratio of 8.3x forward P/E. Dive into our free research report to see why there are better opportunities than PRG.
High-Quality Stocks for All Market Conditions
The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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