The past year hasn’t been kind to the stocks featured in this article. Each has tumbled to its lowest point in 12 months, leaving investors to decide whether they’re witnessing fire sales or falling knives.
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. Keeping that in mind, here is one stock poised to prove the bears wrong and two where the skepticism is well-placed.
Two Stocks to Sell:
Matthews (MATW)
One-Month Return: -23.1%
Originally a death care company, Matthews International (NASDAQ: MATW) is a diversified company offering ceremonial services, brand solutions and industrial technologies.
Why Do We Think MATW Will Underperform?
- Annual revenue declines of 7.4% over the last five years indicate problems with its market positioning
- Cash-burning tendencies make us wonder if it can sustainably generate shareholder value
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
Matthews’s stock price of $21.30 implies a valuation ratio of 27.5x forward P/E. To fully understand why you should be careful with MATW, check out our full research report (it’s free).
SiteOne (SITE)
One-Month Return: -3.8%
Known for distributing John Deere tractors and LESCO turf care products, SiteOne Landscape Supply (NYSE: SITE) provides landscaping products and services to professionals, including irrigation, lighting, and nursery supplies.
Why Should You Sell SITE?
- Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
- Flat earnings per share over the last five years lagged its peers
- Waning returns on capital imply its previous profit engines are losing steam
SiteOne is trading at $96.10 per share, or 20.2x forward P/E. Dive into our free research report to see why there are better opportunities than SITE.
One Stock to Watch:
Lennox (LII)
One-Month Return: -25.4%
Based in Texas and founded over a century ago, Lennox (NYSE: LII) is a climate control solutions company offering heating, ventilation, air conditioning, and refrigeration (HVACR) goods.
Why Does LII Stand Out?
- Excellent operating margin of 17.7% highlights the efficiency of its business model, and it turbocharged its profits by achieving some fixed cost leverage
- Free cash flow margin grew by 8.6 percentage points over the last five years, giving the company more chips to play with
- Industry-leading 37.3% return on capital demonstrates management’s skill in finding high-return investments
At $403.50 per share, Lennox trades at 16.3x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating 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-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.
