1 Volatile Stock on Our Buy List and 2 We Turn Down

Volatility cuts both ways - while it creates opportunities, it also increases risk, making sharp declines just as likely as big gains. This unpredictability can shake out even the most experienced investors.

At StockStory, our job is to help you avoid costly mistakes and stay on the right side of the trade. Keeping that in mind, here is one volatile stock with massive upside potential and two best left to the gamblers.

Two Stocks to Sell:

Sensata Technologies (ST)

Rolling One-Year Beta: 1.74

Originally a temperature sensor control maker and a subsidiary of Texas Instruments for 60 years, Sensata Technology Holdings (NYSE: ST) is a leading supplier of analog sensors used in industrial and transportation applications, best known for its dominant position in the tire pressure monitoring systems in cars.

Why Should You Dump ST?

1. Annual sales declines of 4.8% for the past two years show its products and services struggled to connect with the market during this cycle
2. Competitive supply chain dynamics and steep production costs are reflected in its low gross margin of 30.2%
3. ROIC of 5.3% reflects management’s challenges in identifying attractive investment opportunities, and its shrinking returns suggest its past profit sources are losing steam

Sensata Technologies is trading at $31.83 per share, or 8.9x forward P/E. To fully understand why you should be careful with ST, check out our full research report (it’s free for active Edge members).

Hyatt Hotels (H)

Rolling One-Year Beta: 1.19

Founded in 1957, Hyatt Hotels (NYSE:H) is a global hospitality company with a portfolio of 20 premier brands and over 950 properties across 65 countries.

Why Are We Cautious About H?

1. Softer revenue per room over the past two years suggests it might have to invest in new amenities such as restaurants and bars to attract customers
2. Subpar operating margin of 4.9% constrains its ability to invest in process improvements or effectively respond to new competitive threats
3. Push for growth has led to negative returns on capital, signaling value destruction

At $137.41 per share, Hyatt Hotels trades at 44.8x forward P/E. If you’re considering H for your portfolio, see our FREE research report to learn more.

One Stock to Buy:

CECO Environmental (CECO)

Rolling One-Year Beta: 1.06

With roots dating back to 1869 and a focus on creating cleaner industrial operations, CECO Environmental (NASDAQ:CECO) provides technology and expertise that helps industrial companies reduce emissions, treat water, and improve energy efficiency across various sectors.

Why Do We Love CECO?

1. Annual revenue growth of 19% over the last two years was superb and indicates its market share increased during this cycle
2. Revenue outlook for the upcoming 12 months is outstanding and shows it’s on track to gain market share
3. Adjusted operating margin improvement of 11.4 percentage points over the last five years demonstrates its ability to scale efficiently

CECO Environmental’s stock price of $48.89 implies a valuation ratio of 37.6x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.

Stocks We Like Even 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 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-small-cap company Exlservice (+354% 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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