The past year hasn't been kind to the stocks featured in this article. Each has tumbled to their lowest points in 12 months, leaving investors to decide whether they're witnessing fire sales or falling knives.
Price charts only tell part of the story. Our team at StockStory evaluates each company's underlying fundamentals to separate temporary setbacks from structural declines. Keeping that in mind, here are two stocks poised to prove the bears wrong and one where the skepticism is well-placed.
One Stock to Sell:
Simply Good Foods (SMPL)
One-Month Return: -11.8%
Best known for its Atkins brand that was inspired by the popular diet of the same name, Simply Good Foods (NASDAQ:SMPL) is a packaged food company whose offerings help customers achieve their healthy eating or weight loss goals.
Why Are We Hesitant About SMPL?
- Subscale operations are evident in its revenue base of $1.46 billion, meaning it has fewer distribution channels than its larger rivals
- Estimated sales growth of 1.4% for the next 12 months implies demand will slow from its three-year trend
- 5.5 percentage point decline in its free cash flow margin over the last year reflects the company’s increased investments to defend its market position
Simply Good Foods is trading at $24.85 per share, or 12.3x forward P/E. If you’re considering SMPL for your portfolio, see our FREE research report to learn more.
Two Stocks to Watch:
Yelp (YELP)
One-Month Return: +0.2%
Founded by PayPal alumni Jeremy Stoppelman and Russel Simmons, Yelp (NYSE:YELP) is an online platform that helps people discover local businesses through crowd-sourced reviews.
Why Are We Positive On YELP?
- Platform is difficult to replicate at scale and leads to a best-in-class gross margin of 91.1%
- Healthy EBITDA margin of 26% shows it’s a well-run company with efficient processes, and its profits increased over the last few years as it scaled
- Performance over the past three years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
At $31.81 per share, Yelp trades at 5.8x forward EV/EBITDA. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.
DoubleVerify (DV)
One-Month Return: -26.4%
Using advanced analytics to evaluate over 17 billion digital ad transactions daily, DoubleVerify (NYSE:DV) provides AI-powered technology that verifies digital ads are viewable, fraud-free, brand-suitable, and displayed in the intended geographic location.
Why Does DV Stand Out?
- Impressive 27.9% annual revenue growth over the last five years indicates it’s winning market share
- Software is difficult to replicate at scale and leads to a stellar gross margin of 82.1%
- Fast payback periods on sales and marketing expenses allow the company to invest heavily and onboard many customers concurrently
DoubleVerify’s stock price of $11.37 implies a valuation ratio of 2.4x forward price-to-sales. Is now the right time to buy? See for yourself in our full research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% 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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