Low-volatility stocks may offer stability, but that often comes at the cost of slower growth and the upside potential of more dynamic companies.
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 is one low-volatility stock that could succeed under all market conditions and two stuck in limbo.
Two Stocks to Sell:
Scholastic (SCHL)
Rolling One-Year Beta: -0.06
Creator of the legendary Scholastic Book Fair, Scholastic (NASDAQ:SCHL) is an international company specializing in children's publishing, education, and media services.
Why Do We Avoid SCHL?
- Muted 3.2% annual revenue growth over the last five years shows its demand lagged behind its consumer discretionary peers
- Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
At $38.60 per share, Scholastic trades at 21.5x forward P/E. Check out our free in-depth research report to learn more about why SCHL doesn’t pass our bar.
ExxonMobil (XOM)
Rolling One-Year Beta: -0.97
One of the successor companies to John D. Rockefeller's Standard Oil monopoly that was broken up in 1911, ExxonMobil (NYSE:XOM) explores for and produces crude oil and natural gas, refines and sells petroleum products, and manufactures petrochemicals.
Why Does XOM Worry Us?
- Gross margin of 43.9% is below its competitors, leaving less money to invest in exploration and production
- Efficiency has decreased over the last five years as its EBITDA margin fell by 1.3 percentage points
ExxonMobil’s stock price of $169.26 implies a valuation ratio of 12.9x forward P/E. Read our free research report to see why you should think twice about including XOM in your portfolio.
One Stock to Watch:
East West Bank (EWBC)
Rolling One-Year Beta: 0.65
As the largest independent bank in the U.S. focused on bridging financial services between America and Asia, East West Bancorp (NASDAQ:EWBC) operates a commercial bank that provides personal and business banking services with a unique focus on facilitating U.S.-Asia cross-border transactions.
Why Do We Like EWBC?
- Solid 13.9% annual net interest income growth over the last five years indicates its offerings are gaining share
- Annual tangible book value per share growth of 12.3% over the last five years was superb and indicates its capital strength increased during this cycle
- Market-beating return on equity illustrates that management has a knack for investing in profitable ventures
East West Bank is trading at $125.59 per share, or 1.8x forward P/B. Is now the right time to buy? See for yourself in our full research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.