3 Unprofitable Stocks with Questionable Fundamentals
Unprofitable companies face headwinds as they struggle to keep operating expenses under control. Some may be investing heavily, but the majority fail to convert spending into sustainable growth.
Finding the right unprofitable companies is difficult, which is why we started StockStory - to help you navigate the market. Keeping that in mind, here are three unprofitable companiesto avoid and some better opportunities instead.
Trailing 12-Month GAAP Operating Margin: -7.7%
Founded in 2006 by Howard Lerman, Yext (NYSE:YEXT) offers software as a service that helps their clients manage and monitor their online listings and customer reviews across all relevant databases, from Google Maps to Alexa or Siri.
Why Do We Avoid YEXT?
Underwhelming ARR growth of 4% over the last year suggests the company faced challenges in acquiring and retaining long-term customers
Customer acquisition costs take a while to recoup, making it difficult to justify sales and marketing investments that could increase revenue
Day-to-day expenses have swelled relative to revenue over the last year as its operating margin fell by 6.2 percentage points
At $6.46 per share, Yext trades at 1.8x forward price-to-sales. Read our free research report to see why you should think twice about including YEXT in your portfolio, it's free.
Trailing 12-Month GAAP Operating Margin: -6.7%
Founded by Noah Glass, who wanted to get a cup of coffee faster on his way to work, Olo (NYSE:OLO) provides restaurants and food retailers with software to manage food orders and delivery.
Why Do We Think Twice About OLO?
Sky-high servicing costs result in an inferior gross margin of 54.9% that must be offset through increased usage
Operating losses show it sacrificed profitability while scaling the business
Free cash flow margin is expected to remain in place over the coming year
Olo's stock price of $6.28 implies a valuation ratio of 3.1x forward price-to-sales. To fully understand why you should be careful with OLO, check out our full research report (it's free).
Trailing 12-Month GAAP Operating Margin: -2.7%
Founded in 1990 in Cincinnati, Ohio, Paycor (NASDAQ: PYCR) provides software for small businesses to manage their payroll and HR needs in one place.
Why Are We Hesitant About PYCR?
High servicing costs result in a relatively inferior gross margin of 66% that must be offset through increased usage
Suboptimal cost structure is highlighted by its history of operating losses
Forecasted free cash flow margin suggests the company will fail to improve its cash conversion over the next year
Paycor is trading at $22.49 per share, or 5.2x forward price-to-sales. Check out our free in-depth research report to learn more about why PYCR doesn't pass our bar.
Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking 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 175% over the last five years.
Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Sterling Infrastructure (+1,096% five-year return). Find your next big winner with StockStory today for free.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
43 minutes ago
- Yahoo
Jabil (JBL) Q2 Earnings: What To Expect
Electronics manufacturing services provider Jabil (NYSE:JBL) will be reporting earnings this Tuesday before market open. Here's what to look for. Jabil beat analysts' revenue expectations by 5.1% last quarter, reporting revenues of $6.73 billion, flat year on year. It was a strong quarter for the company, with an impressive beat of analysts' full-year EPS guidance estimates and full-year revenue guidance topping analysts' expectations. Is Jabil a buy or sell going into earnings? Read our full analysis here, it's free. This quarter, analysts are expecting Jabil's revenue to grow 4.1% year on year to $7.04 billion, a reversal from the 20.2% decrease it recorded in the same quarter last year. Adjusted earnings are expected to come in at $2.32 per share. Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Jabil has missed Wall Street's revenue estimates twice over the last two years. With Jabil being the first among its peers to report earnings this season, we don't have anywhere else to look to get a hint at how this quarter will unravel for tech hardware & electronics stocks. However, investors in the segment have had fairly steady hands going into earnings, with share prices down 1.8% on average over the last month. Jabil is up 3.1% during the same time and is heading into earnings with an average analyst price target of $176.01 (compared to the current share price of $172.63). Today's young investors likely haven't read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
an hour ago
- Yahoo
Here's How You Can Earn $100 In Passive Income By Investing In Prologis Stock
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Prologis Inc. (NYSE:PLD) is a real estate investment trust focused on logistics facilities. The 52-week range of Prologis stock price was $85.35 to $132.57. Prologis' dividend yield is 3.72%. It paid $4.04 per share in dividends during the last 12 months. Don't Miss: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — Peter Thiel turned $1,700 into $5 billion—now accredited investors are eyeing this software company with similar breakout potential. Learn how you can On April 16, the company announced its Q1 2025 earnings, posting FFO of $1.42, beating the consensus estimate of $1.38, while revenues of $2 billion came in below the consensus of $2.04 billion, as reported by Benzinga. 'We delivered exceptional results this quarter—signing leases totaling 58 million square feet, breaking ground on new build-to-suits with strategic customers and expanding our power capacity to support the growing demand for data centers,' said Dan Letter, president of Prologis. For full-year 2025, the company expects core FFO per share in the range of $5.65 to $5.81. Trending: Invest Where It Hurts — And Help Millions Heal: If you want to make $100 per month — $1,200 annually — from Prologis dividends, your investment value needs to be approximately $32,258, which is around 297 shares at $108.50 each. Understanding the dividend yield calculations: When making an estimate, you need two key variables — the desired annual income ($1,200) and the dividend yield (3.72% in this case). So, $1,200 / 0.0372 = $32,258 to generate an income of $100 per month. You can calculate the dividend yield by dividing the annual dividend payments by the current price of the stock. The dividend yield can change over time. This is the outcome of fluctuating stock prices and dividend payments on a rolling instance, assume a stock that pays $2 as an annual dividend is priced at $50. Its dividend yield would be $2/$50 = 4%. If the stock price rises to $60, the dividend yield drops to 3.33% ($2/$60). A drop in stock price to $40 will have an inverse effect and increase the dividend yield to 5% ($2/$40). In summary, income-focused investors may find Prologis stock an attractive option for making a steady income of $100 per month by owning 297 shares of stock. There may be more upside to come as investors benefit from the company's consistent dividend hikes. Prologis has raised its dividend consecutively for the last 11 years. Check out this article by Benzinga for three stocks offering high dividend yields. Read Next: Inspired by Uber and Airbnb – Deloitte's fastest-growing software company is transforming 7 billion smartphones into income-generating assets – Image: Shutterstock This article Here's How You Can Earn $100 In Passive Income By Investing In Prologis Stock originally appeared on Sign in to access your portfolio
Yahoo
3 hours ago
- Yahoo
Insiders At Vistra Sold US$39m In Stock, Alluding To Potential Weakness
Over the past year, many Vistra Corp. (NYSE:VST) insiders sold a significant stake in the company which may have piqued investors' interest. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag. While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. Notably, that recent sale by Scott Helm is the biggest insider sale of Vistra shares that we've seen in the last year. That means that even when the share price was slightly below the current price of US$174, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 16% of Scott Helm's stake. In total, Vistra insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction! View our latest analysis for Vistra If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar). Over the last three months, we've seen significant insider selling at Vistra. In total, insiders dumped US$22m worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain. Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Vistra insiders own 1.0% of the company, worth about US$576m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders. Insiders haven't bought Vistra stock in the last three months, but there was some selling. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But it is good to see that Vistra is growing earnings. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of Vistra. Of course Vistra may not be the best stock to buy. So you may wish to see this free collection of high quality companies. For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
