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?
While market timing can be an extremely profitable strategy, it has burned many investors and requires rigorous analysis - something we specialize in at StockStory. That said, here is one stock poised to prove the bears wrong and two where the skepticism is well-placed.
Two Stocks to Sell:
Wynn Resorts (WYNN)
One-Month Return: -2.4%
Founded by the former Mirage Resorts CEO, Wynn Resorts (NASDAQ: WYNN) is a global developer and operator of high-end hotels and casinos, known for its luxurious properties and premium guest services.
Why Is WYNN Risky?
- Muted 2.3% annual revenue growth over the last two years shows its demand lagged behind its consumer discretionary peers
- Poor free cash flow margin of 10.2% for the last two years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends
- 6× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly
Wynn Resorts is trading at $97.04 per share, or 22.3x forward P/E. If you’re considering WYNN for your portfolio, see our FREE research report to learn more.
Hertz (HTZ)
One-Month Return: -21.5%
Started with a dozen Model T Fords, Hertz (NASDAQ: HTZ) is a global car rental company providing vehicle rental services to leisure and business travelers.
Why Are We Out on HTZ?
- Sales tumbled by 3.8% annually over the last two years, showing market trends are working against it during this cycle
- Waning returns on capital imply its previous profit engines are losing steam
Hertz’s stock price of $1.81 implies a valuation ratio of 109.3x forward EV-to-EBITDA. To fully understand why you should be careful with HTZ, check out our full research report (it’s free).
One Stock to Buy:
Copart (CPRT)
One-Month Return: -1.6%
Starting as a single salvage yard in California in 1982, Copart (NASDAQ: CPRT) operates an online auction platform that connects sellers of damaged and salvage vehicles with buyers ranging from dismantlers and rebuilders to used car dealers and exporters.
Why Will CPRT Beat the Market?
- Annual revenue growth of 13.4% over the past five years was outstanding, reflecting market share gains this cycle
- Robust free cash flow margin of 24.3% gives it many options for capital deployment, and its improved cash conversion implies it’s becoming a less capital-intensive business
- ROIC punches in at 31.8%, illustrating management’s expertise in identifying profitable investments
At $27.66 per share, Copart trades at 17.3x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum 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-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.
