3 Low-Volatility Stocks We Steer Clear Of

Low-volatility stocks may offer stability, but that often comes at the cost of slower growth and the upside potential of more dynamic companies.

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.

Nike (NKE)

Rolling One-Year Beta: 0.95

Originally selling Japanese Onitsuka Tiger sneakers as Blue Ribbon Sports, Nike (NYSE:NKE) is a global titan in athletic footwear, apparel, equipment, and accessories.

Why Do We Steer Clear of NKE?

1. Underwhelming constant currency revenue performance over the past two years suggests its product offering at current prices doesn’t resonate with customers
2. Sales are projected to be flat over the next 12 months and imply weak demand
3. Waning returns on capital imply its previous profit engines are losing steam

At $71.10 per share, Nike trades at 41.6x forward P/E. Check out our free in-depth research report to learn more about why NKE doesn’t pass our bar.

NVR (NVR)

Rolling One-Year Beta: 0.23

Known for its unique land acquisition strategy, NVR (NYSE:NVR) is a respected homebuilder and mortgage company in the United States.

Why Are We Wary of NVR?

1. Average backlog growth of 1.3% over the past two years was mediocre and suggests fewer customers signed long-term contracts
2. Projected sales decline of 6.9% for the next 12 months points to a tough demand environment ahead
3. Diminishing returns on capital suggest its earlier profit pools are drying up

NVR is trading at $8,037 per share, or 18.7x forward P/E. To fully understand why you should be careful with NVR, check out our full research report (it’s free).

LGI Homes (LGIH)

Rolling One-Year Beta: 0.93

Based in Texas, LGI Homes (NASDAQ:LGIH) is a homebuilding company specializing in constructing affordable, entry-level single-family homes in desirable communities across the United States.

Why Should You Dump LGIH?

1. Product roadmap and go-to-market strategy need to be reconsidered as its backlog has averaged 10.4% declines over the past two years
2. Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
3. Short cash runway increases the probability of a capital raise that dilutes existing shareholders

LGI Homes’s stock price of $56.74 implies a valuation ratio of 8.3x forward P/E. Dive into our free research report to see why there are better opportunities than LGIH.

Stocks We Like More

Trump’s April 2025 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 6 Stocks for this week. 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 Kadant (+351% 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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