Stability is great, but low-volatility stocks may struggle to deliver market-beating returns over time as they sometimes underperform during bull markets.
Luckily for you, StockStory helps you navigate which companies are truly worth holding. That said, here are three low-volatility stocks to avoid and some better opportunities instead.
Dole (DOLE)
Rolling One-Year Beta: 0.47
Known for its delicious pineapples and Hawaiian roots, Dole (NYSE:DOLE) is a global agricultural company specializing in fresh fruits and vegetables.
Why Are We Wary of DOLE?
- Products fail to spark excitement with consumers, as seen in its flat sales over the last three years
- Gross margin of 8.4% is below its competitors, leaving less money to invest in areas like marketing and production facilities
- Responsiveness to unforeseen market trends is restricted due to its substandard operating margin profitability
Dole is trading at $14.69 per share, or 10.6x forward P/E. To fully understand why you should be careful with DOLE, check out our full research report (it’s free).
Wynn Resorts (WYNN)
Rolling One-Year Beta: 0.92
Founded by the former Mirage Resorts CEO, Wynn Resorts (NASDAQ:WYNN) is a global developer and operator of high-end hotels and casinos, known for its luxurious properties and premium guest services.
Why Are We Cautious About WYNN?
- Muted 9.9% annual revenue growth over the last five years shows its demand lagged behind its consumer discretionary peers
- Underwhelming 4% return on capital reflects management’s difficulties in finding profitable growth opportunities
- High net-debt-to-EBITDA ratio of 5× increases the risk of forced asset sales or dilutive financing if operational performance weakens
At $126.71 per share, Wynn Resorts trades at 27.2x forward P/E. Check out our free in-depth research report to learn more about why WYNN doesn’t pass our bar.
Pediatrix Medical Group (MD)
Rolling One-Year Beta: 0.68
With a network of approximately 2,620 affiliated physicians caring for some of the most vulnerable patients, Pediatrix Medical Group (NYSE:MD) provides specialized physician services focused on neonatal, maternal-fetal, pediatric cardiology and other pediatric subspecialty care across 37 states.
Why Do We Think MD Will Underperform?
- Poor comparable store sales performance over the past two years indicates it’s having trouble bringing new patients into its facilities
- Projected sales decline of 1.5% over the next 12 months indicates demand will continue deteriorating
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
Pediatrix Medical Group’s stock price of $17.21 implies a valuation ratio of 10.4x forward P/E. Read our free research report to see why you should think twice about including MD in your portfolio.
Stocks We Like More
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 5 Growth Stocks for this month. 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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