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 trading at a big discount to its intrinsic value and two best left ignored.

Two Value Stocks to Sell:

Steven Madden (SHOO)

Forward P/E Ratio: 10.1x

As seen in the infamous Wolf of Wall Street movie, Steven Madden (NASDAQ:SHOO) is a fashion brand famous for its trendy and innovative footwear, appealing to a young and style-conscious audience.

Why Does SHOO Give Us Pause?

1. 3.7% annual revenue growth over the last two years was slower than its consumer discretionary peers

2. Earnings per share lagged its peers over the last five years as they only grew by 6.8% annually

3. Poor free cash flow margin of 9% for the last two years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends

Steven Madden is trading at $25.50 per share, or 10.1x forward price-to-earnings. To fully understand why you should be careful with SHOO, check out our full research report (it’s free) .

ManpowerGroup (MAN)

Forward P/E Ratio: 12.6x

Founded during the post-World War II economic boom when businesses needed temporary workers, ManpowerGroup (NYSE:MAN) connects millions of people to employment opportunities through its global network of staffing, recruitment, and workforce management services.

Why Do We Think MAN Will Underperform?

1. 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

2. Sales are projected to tank by 5.8% over the next 12 months as its demand continues evaporating

3. Performance over the past five years shows each sale was less profitable as its earnings per share dropped by 10% annually, worse than its revenue

ManpowerGroup’s stock price of $59.01 implies a valuation ratio of 12.6x forward price-to-earnings. Dive into our free research report to see why there are better opportunities than MAN .

One Value Stock to Watch:

Amentum (AMTM)

Forward P/E Ratio: 8.5x

With operations spanning approximately 80 countries and a workforce of specialized engineers and technical experts, Amentum Holdings (NYSE:AMTM) provides advanced engineering and technology solutions to U.S. government agencies, allied governments, and commercial enterprises across defense, energy, and space sectors.