Stability is great, but low-volatility stocks may struggle to deliver market-beating returns over time as they sometimes underperform during bull markets.
Choosing the wrong investments can cause you to fall behind, which is why we started StockStory - to separate the winners from the losers. Keeping that in mind, here is one low-volatility stock that could succeed under all market conditions and two stuck in limbo.
Two Stocks to Sell:
Hologic (HOLX)
Rolling One-Year Beta: -0.04
As a pioneer in 3D mammography technology that has revolutionized breast cancer detection, Hologic (NASDAQ:HOLX) develops and manufactures diagnostic products, medical imaging systems, and surgical devices focused primarily on women's health and wellness.
Why Does HOLX Fall Short?
- Constant currency revenue growth has disappointed over the past two years and shows demand was soft
- Costs have risen faster than its revenue over the last five years, causing its adjusted operating margin to decline by 23.6 percentage points
- Eroding returns on capital suggest its historical profit centers are aging
At $66.92 per share, Hologic trades at 15.3x forward P/E. Read our free research report to see why you should think twice about including HOLX in your portfolio.
Stewart Information Services (STC)
Rolling One-Year Beta: 0.72
Founded in 1893 during America's westward expansion when property records were often disputed, Stewart Information Services (NYSE:STC) provides title insurance and real estate services, helping homebuyers, sellers, and lenders verify property ownership and protect against title defects.
Why Are We Hesitant About STC?
- 1.3% annual net premiums earned growth over the last two years was slower than its insurance peers
- Earnings per share fell by 1% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- Muted 1.6% annual book value per share growth over the last two years shows its capital generation lagged behind its insurance peers
Stewart Information Services is trading at $67.90 per share, or 1.3x forward P/B. If you’re considering STC for your portfolio, see our FREE research report to learn more.
One Stock to Watch:
WD-40 (WDFC)
Rolling One-Year Beta: -0.07
Short for “Water Displacement perfected on the 40th try”, WD-40 (NASDAQ:WDFC) is a renowned American consumer goods company known for its iconic and versatile spray, WD-40 Multi-Use Product.
Why Is WDFC Interesting?
- Differentiated product offerings are difficult to replicate at scale and lead to a stellar gross margin of 53.8%
- Robust free cash flow margin of 15.4% gives it many options for capital deployment
- Industry-leading 27.5% return on capital demonstrates management’s skill in finding high-return investments
WD-40’s stock price of $219.28 implies a valuation ratio of 36.9x 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
Trump’s April 2024 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-micro-cap company Tecnoglass (+1,754% 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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