Stability is great, but low-volatility stocks may struggle to deliver market-beating returns over time as they sometimes underperform during bull markets.
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 that don’t make the cut and some better opportunities instead.
Home Depot (HD)
Rolling One-Year Beta: 0.67
Founded and headquartered in Atlanta, Georgia, Home Depot (NYSE: HD) is a home improvement retailer that sells everything from tools to building materials to appliances.
Why Does HD Fall Short?
- Disappointing same-store sales over the past two years show customers aren’t responding well to its product selection and store experience
- Estimated sales growth of 1.6% for the next 12 months implies demand will slow from its six-year trend
- Capital intensity has ramped up over the last year as its free cash flow margin decreased by 2.5 percentage points
At $362.79 per share, Home Depot trades at 23.7x forward P/E. To fully understand why you should be careful with HD, check out our full research report (it’s free).
Molson Coors (TAP)
Rolling One-Year Beta: 0.07
Sporting an impressive roster of iconic beer brands, Molson Coors (NYSE: TAP) is a global brewing giant with a rich history dating back more than two centuries.
Why Does TAP Worry Us?
- Shrinking unit sales over the past two years suggest it might have to lower prices to stimulate growth
- Projected sales growth of 1.5% for the next 12 months suggests sluggish demand
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
Molson Coors’s stock price of $51.26 implies a valuation ratio of 8x forward P/E. Read our free research report to see why you should think twice about including TAP in your portfolio.
General Mills (GIS)
Rolling One-Year Beta: -0.12
Best known for its portfolio of powerhouse breakfast cereal brands, General Mills (NYSE: GIS) is a packaged foods company that has also made a mark in cereals, baking products, and snacks.
Why Do We Think Twice About GIS?
- Declining unit sales over the past two years indicate demand is soft and that the company may need to revise its product strategy
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Sales are projected to tank by 4.3% over the next 12 months as demand evaporates
General Mills is trading at $54.51 per share, or 12.9x forward P/E. Check out our free in-depth research report to learn more about why GIS doesn’t pass our bar.
Stocks We Like More
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio 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-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.
