3 Out-of-Favor Stocks with Open Questions

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 are three stocks where the skepticism is well-placed and some better opportunities to consider.

Cracker Barrel (CBRL)

One-Month Return: -9.2%

Known for its country-themed food and merchandise, Cracker Barrel (NASDAQ:CBRL) is a beloved American restaurant and retail chain that celebrates the warmth and charm of Southern hospitality.

Why Should You Dump CBRL?

1. Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
2. Earnings per share fell by 22.6% annually over the last six years while its revenue grew, showing its incremental sales were much less profitable
3. High net-debt-to-EBITDA ratio of 6× could force the company to raise capital at unfavorable terms if market conditions deteriorate

Cracker Barrel is trading at $25.99 per share, or 16.7x forward EV-to-EBITDA. Check out our free in-depth research report to learn more about why CBRL doesn’t pass our bar.

ChargePoint (CHPT)

One-Month Return: -6.9%

The most prominent EV charging company during the COVID bull market, ChargePoint (NYSE:CHPT) is a provider of electric vehicle charging technology solutions in North America and Europe.

Why Are We Wary of CHPT?

1. Annual sales declines of 13.8% for the past two years show its products and services struggled to connect with the market during this cycle
2. Cash-burning tendencies make us wonder if it can sustainably generate shareholder value
3. EBITDA losses may force it to accept punitive lending terms or high-cost debt

At $7.10 per share, ChargePoint trades at 0.4x forward price-to-sales. To fully understand why you should be careful with CHPT, check out our full research report (it’s free for active Edge members).

CDW (CDW)

One-Month Return: -2.3%

Serving as a crucial bridge between technology manufacturers and end users since 1984, CDW (NASDAQ:CDW) is a multi-brand provider of information technology solutions that helps businesses and public sector organizations select, implement, and manage hardware, software, and IT services.

Why Does CDW Worry Us?

1. Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last two years
2. Anticipated sales growth of 2% for the next year implies demand will be shaky
3. Earnings per share were flat over the last two years and fell short of the peer group average

CDW’s stock price of $139.79 implies a valuation ratio of 13.6x forward P/E. Dive into our free research report to see why there are better opportunities than CDW.

Stocks We Like More

The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 6 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-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.