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.
While market timing can be an extremely profitable strategy, it has burned many investors and requires rigorous analysis - something we specialize in at StockStory. Keeping that in mind, here are three stocks where the skepticism is well-placed and some better opportunities to consider.
RE/MAX (RMAX)
One-Month Return: +0.3%
Short for Real Estate Maximums, RE/MAX (NYSE:RMAX) operates a real estate franchise network spanning over 100 countries and territories.
Why Do We Pass on RMAX?
- Sluggish trends in its agents suggest customers aren’t adopting its solutions as quickly as the company hoped
- Incremental sales over the last five years were much less profitable as its earnings per share fell by 8.9% annually while its revenue grew
- Low returns on capital reflect management’s struggle to allocate funds effectively
RE/MAX’s stock price of $7.55 implies a valuation ratio of 5.5x forward P/E. If you’re considering RMAX for your portfolio, see our FREE research report to learn more.
UFP Industries (UFPI)
One-Month Return: -9.6%
Beginning as a lumber supplier in the 1950s, UFP Industries (NASDAQ:UFPI) is a holding company making building materials for the construction, retail, and industrial sectors.
Why Does UFPI Fall Short?
- Declining unit sales over the past two years imply it may need to invest in improvements to get back on track
- Earnings per share have contracted by 21.7% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance
- Waning returns on capital imply its previous profit engines are losing steam
At $96.35 per share, UFP Industries trades at 13.4x forward P/E. To fully understand why you should be careful with UFPI, check out our full research report (it’s free).
PacBio (PACB)
One-Month Return: -18.6%
Pioneering what scientists call "HiFi long-read sequencing," recognized as Nature Methods' method of the year for 2022, Pacific Biosciences (NASDAQ:PACB) develops advanced DNA sequencing systems that enable scientists and researchers to analyze genomes with unprecedented accuracy and completeness.
Why Do We Think PACB Will Underperform?
- Muted 6.6% annual revenue growth over the last two years shows its demand lagged behind its healthcare peers
- 29.1 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
- Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution
PacBio is trading at $0.92 per share, or 1.7x forward price-to-sales. Dive into our free research report to see why there are better opportunities than PACB.
High-Quality Stocks for All Market Conditions
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.
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-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free.