Rock-bottom prices don't always mean rock-bottom businesses. The stocks we're examining today have all touched their 52-week lows, creating a classic investor's dilemma: bargain opportunity or value trap?
At StockStory, we dig beneath the surface of price movements to uncover whether a company's fundamentals justify its current valuation or suggest hidden potential. Keeping that in mind, here is one stock where the poor sentiment is creating a buying opportunity and two facing legitimate challenges.
Two Stocks to Sell:
PubMatic (PUBM)
One-Month Return: -13.9%
Powering billions of daily ad impressions across the open internet, PubMatic (NASDAQ:PUBM) operates a technology platform that helps publishers maximize revenue from their digital advertising inventory while giving advertisers more control and transparency.
Why Do We Think PUBM Will Underperform?
- Below-average net revenue retention rate of 107% suggests it has some trouble expanding within existing accounts
- Extended payback periods on sales investments suggest the company’s platform isn’t resonating enough to drive efficient sales conversions
- Free cash flow margin is forecasted to shrink by 8.4 percentage points in the coming year, suggesting the company will consume more capital to keep up with its competitors
PubMatic’s stock price of $7.74 implies a valuation ratio of 1.3x forward price-to-sales. Dive into our free research report to see why there are better opportunities than PUBM.
Sprinklr (CXM)
One-Month Return: -12.7%
With a proprietary AI engine processing 450 million data points daily across 30+ digital channels, Sprinklr (NYSE:CXM) provides cloud-based software that helps large enterprises manage customer experiences across social, messaging, chat, and voice channels.
Why Are We Out on CXM?
- Average billings growth of 6.9% over the last year was subpar, suggesting it struggled to push its software and might have to lower prices to stimulate demand
- Estimated sales growth of 4.1% for the next 12 months implies demand will slow from its two-year trend
- Static operating margin over the last year shows it couldn’t become more efficient
Sprinklr is trading at $6.74 per share, or 2x forward price-to-sales. To fully understand why you should be careful with CXM, check out our full research report (it’s free).
One Stock to Buy:
Payoneer (PAYO)
One-Month Return: +8.5%
Founded during the early days of global e-commerce in 2005 to solve international payment challenges, Payoneer (NASDAQ:PAYO) provides financial technology services that enable small and medium-sized businesses to send and receive payments globally across borders.
Why Is PAYO a Good Business?
- Impressive 28.2% annual revenue growth over the last five years indicates it’s winning market share this cycle
- Share buybacks catapulted its annual earnings per share growth to 56.2%, which outperformed its revenue gains over the last two years
At $6.20 per share, Payoneer trades at 20.7x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
Check out the high-quality names we’ve flagged in our Top 6 Stocks for this week. 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.