3 Low-Volatility Stocks We're Skeptical Of

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. That said, here are three low-volatility stocks to avoid and some better opportunities instead.

Herbalife (HLF)

Rolling One-Year Beta: 0.40

With the first products sold out of the trunk of the founder’s car, Herbalife (NYSE:HLF) today offers a portfolio of shakes, supplements, personal care products, and weight management programs to help customers reach their nutritional and fitness goals.

Why Are We Cautious About HLF?

1. Declining unit sales over the past two years show it’s struggled to move its products and had to rely on price increases
2. Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 3.6%
3. Earnings per share decreased by more than its revenue over the last three years, partly because it diluted shareholders

Herbalife is trading at $8.98 per share, or 4.2x forward P/E. To fully understand why you should be careful with HLF, check out our full research report (it’s free).

Keurig Dr Pepper (KDP)

Rolling One-Year Beta: 0.19

Born out of a 2018 merger between Keurig Green Mountain and Dr Pepper Snapple, Keurig Dr Pepper (NASDAQ:KDP) is a consumer staples powerhouse boasting a portfolio of beverages including sodas, coffees, and juices.

Why Is KDP Not Exciting?

1. Sizable revenue base leads to growth challenges as its 5.9% annual revenue increases over the last three years fell short of other consumer staples companies
2. Expenses have increased as a percentage of revenue over the last year as its operating margin fell by 6.1 percentage points
3. Underwhelming 5.8% return on capital reflects management’s difficulties in finding profitable growth opportunities

Keurig Dr Pepper’s stock price of $26.28 implies a valuation ratio of 12.5x forward P/E. If you’re considering KDP for your portfolio, see our FREE research report to learn more.

Assured Guaranty (AGO)

Rolling One-Year Beta: 0.66

Serving as a financial safety net for over $11 trillion in debt service payments since its founding in 2003, Assured Guaranty (NYSE:AGO) provides credit protection products that guarantee scheduled payments on municipal bonds, infrastructure projects, and structured finance obligations.

Why Are We Wary of AGO?

1. Insurance policy sales contracted this cycle as net premiums earned decreased by 4.3% annually over the last five years
2. Sales are projected to tank by 29.8% over the next 12 months as its demand continues evaporating
3. Low return on equity reflects management’s struggle to allocate funds effectively

At $84.88 per share, Assured Guaranty trades at 0.7x forward P/B. Dive into our free research report to see why there are better opportunities than AGO.

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-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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