Stocks trading in the $1-10 range are generally smaller players with less risk than their penny stock counterparts. But that doesn’t mean the underlying businesses are cheap, and we advise caution as many have questionable fundamentals.
The downside that can come from buying these securities is precisely why we started StockStory - to isolate the long-term winners from the losers so you can invest with confidence. That said, here are three stocks under $10 to pass on and some alternatives you should look into instead.
SmartRent (SMRT)
Share Price: $1.42
Founded by an employee at a real estate rental company, SmartRent (NYSE:SMRT) provides smart home devices and software for multifamily residential properties, single-family rental homes, and student housing communities.
Why Are We Hesitant About SMRT?
- Sales tumbled by 16.6% annually over the last two years, showing market trends are working against it during this cycle
- Historically negative EPS casts doubt for cautious investors and clouds its long-term earnings prospects
- Cash-burning history makes us doubt the long-term viability of its business model
At $1.42 per share, SmartRent trades at 47.2x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than SMRT.
SoundHound AI (SOUN)
Share Price: $7.92
Born from the idea that machines should understand human speech as naturally as people do, SoundHound AI (NASDAQ:SOUN) develops voice recognition and conversational intelligence technology that enables businesses to integrate voice assistants into their products and services.
Why Are We Cautious About SOUN?
- Extended payback periods on sales investments suggest the company’s platform isn’t resonating enough to drive efficient sales conversions
- Cash burn makes us question whether it can achieve sustainable long-term growth
- Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution
SoundHound AI is trading at $7.92 per share, or 11.7x forward price-to-sales. Read our free research report to see why you should think twice about including SOUN in your portfolio.
Evolent Health (EVH)
Share Price: $3.98
Founded in 2011 to transform how healthcare is delivered to patients with complex needs, Evolent Health (NYSE:EVH) provides specialty care management services and technology solutions that help health plans and providers deliver better care for patients with complex conditions.
Why Is EVH Not Exciting?
- Disappointing average lives on platform over the past two years imply it may need to invest in improvements to get back on track
- Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value
- 7× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly
Evolent Health’s stock price of $3.98 implies a valuation ratio of 12.8x forward P/E. To fully understand why you should be careful with EVH, check out our full research report (it’s free).
Stocks We Like More
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.