3 Low-Volatility Stocks We Find Risky

A stock with low volatility can be reassuring, but it doesn’t always mean strong long-term performance. Investors who prioritize stability may miss out on higher-reward opportunities elsewhere.

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 are three low-volatility stocks to avoid and some better opportunities instead.

eHealth (EHTH)

Rolling One-Year Beta: 0.60

Aiming to address a high-stakes and often confusing decision, eHealth (NASDAQ:EHTH) guides consumers through health insurance enrollment and related topics.

Why Are We Hesitant About EHTH?

1. Intense competition is diverting traffic from its platform as its estimated membership fell by 1.8% annually
2. Projected sales decline of 3.4% for the next 12 months points to a tough demand environment ahead
3. Short cash runway increases the probability of a capital raise that dilutes existing shareholders

eHealth is trading at $3.82 per share, or 2.5x forward EV/EBITDA. Dive into our free research report to see why there are better opportunities than EHTH.

CSX (CSX)

Rolling One-Year Beta: 0.76

Established as part of the Chessie System and Seaboard Coast Line Industries merger, CSX (NASDAQ:CSX) is a transportation company specializing in freight rail services.

Why Do We Avoid CSX?

1. Flat unit sales over the past two years suggest it might have to lower prices to accelerate growth
2. Earnings per share decreased by more than its revenue over the last two years, showing each sale was less profitable
3. Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 15.6 percentage points

At $34.90 per share, CSX trades at 18.8x forward P/E. Read our free research report to see why you should think twice about including CSX in your portfolio.

Prudential (PRU)

Rolling One-Year Beta: 0.95

Recognized by its iconic Rock of Gibraltar logo symbolizing strength and stability since 1896, Prudential Financial (NYSE:PRU) provides life insurance, annuities, retirement solutions, investment management, and other financial services to individual and institutional customers globally.

Why Should You Sell PRU?

1. Insurance products are facing significant market challenges during this cycle as net premiums earned has declined by 4.6% annually over the last two years
2. Sales are expected to decline once again over the next 12 months as it continues working through a challenging demand environment
3. Products and services are facing significant credit quality challenges during this cycle as book value per share has declined by 11.3% annually over the last five years

Prudential’s stock price of $103.40 implies a valuation ratio of 1.2x forward P/B. If you’re considering PRU for your portfolio, see our FREE research report to learn more.

High-Quality Stocks for All Market Conditions

Donald Trump’s April 2024 "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 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-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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