The low valuation multiples for value stocks provide a margin of safety that growth stocks rarely offer. However, the challenge lies in determining whether these cheap assets are genuinely undervalued or simply on sale due to their potentially deteriorating business models.
Identifying genuine bargains from value traps is something many investors struggle with, which is why we started StockStory - to help you find the best companies. That said, here is one value stock offering a compelling risk-reward profile and two climbing an uphill battle.
Two Value Stocks to Sell:
Janus (JBI)
Forward P/E Ratio: 11.3x
Standing out with its digital keyless entry into self-storage room technology, Janus (NYSE:JBI) is a provider of easily accessible self-storage solutions.
Why Are We Cautious About JBI?
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Sales are projected to tank by 1.2% over the next 12 months as its demand continues evaporating
- Earnings per share have contracted by 21.6% annually over the last three years, a headwind for returns as stock prices often echo long-term EPS performance
Janus’s stock price of $7.18 implies a valuation ratio of 11.3x forward P/E. If you’re considering JBI for your portfolio, see our FREE research report to learn more.
Encore Capital Group (ECPG)
Forward P/E Ratio: 7.6x
Operating in the often misunderstood world of debt collection since 1999, Encore Capital Group (NASDAQ:ECPG) purchases portfolios of defaulted consumer debt at deep discounts and works with individuals to recover these obligations while helping them toward financial recovery.
Why Is ECPG Not Exciting?
- Muted 1.3% annual revenue growth over the last five years shows its demand lagged behind its financials peers
- Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 15.9% annually
- High net-debt-to-EBITDA ratio of 11× could force the company to raise capital at unfavorable terms if market conditions deteriorate
Encore Capital Group is trading at $56.16 per share, or 7.6x forward P/E. Dive into our free research report to see why there are better opportunities than ECPG.
One Value Stock to Watch:
BGC (BGC)
Forward P/E Ratio: 6.9x
Tracing its roots back to 1945 and named after founder Bernard Gerald Cantor, BGC Group (NASDAQ:BGC) operates a global brokerage and financial technology platform that facilitates trading across fixed income, foreign exchange, equities, energy, and commodities markets.
Why Could BGC Be a Winner?
- Market share has increased this cycle as its 18.7% annual revenue growth over the last two years was exceptional
- Performance over the past two years shows its incremental sales were more profitable, as its annual earnings per share growth of 20.9% outpaced its revenue gains
- Adequate return on equity shows management makes decent investment decisions
At $9.04 per share, BGC trades at 6.9x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. 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 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.