1 Oversold Stock Primed to Rebound and 2 We Question

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?

At StockStory, we dig beneath the surface of price movements to uncover whether a company's fundamentals justify its current valuation or suggest hidden potential. That said, here is one stock where the poor sentiment is creating a buying opportunity and two where the skepticism is well-placed.

Two Stocks to Sell:

Asure Software (ASUR)

One-Month Return: +1.2%

Operating in the often-overlooked smaller metropolitan markets where HR expertise can be scarce, Asure Software (NASDAQ:ASUR) provides cloud-based human capital management software and services that help small and medium-sized businesses manage payroll, taxes, time tracking, and HR compliance.

Why Are We Out on ASUR?

1. Sales trends were unexciting over the last two years as its 4% annual growth was well below the typical software company
2. Operating margin was unchanged over the last year, suggesting it failed to gain leverage on its fixed costs
3. Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 5.5% for the last year

Asure Software is trading at $8.32 per share, or 1.4x forward price-to-sales. Read our free research report to see why you should think twice about including ASUR in your portfolio.

PennyMac Mortgage Investment Trust (PMT)

One-Month Return: +4%

Operating as a real estate investment trust since 2009 to maintain tax advantages, PennyMac Mortgage Investment Trust (NYSE:PMT) is a specialty finance company that invests in mortgage-related assets and operates a correspondent lending business.

Why Does PMT Give Us Pause?

1. Products and services are facing significant end-market challenges during this cycle as sales have declined by 21.6% annually over the last five years
2. Estimated net interest income decline of 116% for the next 12 months implies a challenging demand environment
3. Annual tangible book value per share declines of 5.2% for the past five years show its capital management struggled during this cycle

PennyMac Mortgage Investment Trust’s stock price of $12.32 implies a valuation ratio of 0.8x forward P/B. Check out our free in-depth research report to learn more about why PMT doesn’t pass our bar.

One Stock to Buy:

Costco (COST)

One-Month Return: -2.1%

Designed to be a one-stop shop for the suburban consumer, Costco (NASDAQ:COST) is a membership-only retail chain that sells groceries, apparel, toys, and household items, often in bulk quantities.

Why Will COST Beat the Market?

1. Same-store sales growth averaged 5.6% over the past two years, showing it’s bringing new and repeat shoppers into its stores
2. Enormous revenue base of $275.2 billion compensates for its low gross margin and provides significant leverage in supplier negotiations
3. Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures

At $915.48 per share, Costco trades at 45.7x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.

High-Quality Stocks for All Market Conditions

Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.

Take advantage of the rebound by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

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-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today

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