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. Keeping that in mind, here are three low-volatility stocks to avoid and some better opportunities instead.
Kellanova (K)
Rolling One-Year Beta: 0.12
With Corn Flakes as its first and most iconic product, Kellanova (NYSE:K) is a packaged foods company that is dominant in the cereal and snack categories.
Why Does K Worry Us?
- Shrinking unit sales over the past two years indicate demand is soft and that the company may need to revise its product strategy
- Issuance of new shares over the last three years caused its earnings per share to fall by 4.4% annually, even worse than its revenue declines
- 3.5 percentage point decline in its free cash flow margin over the last year reflects the company’s increased investments to defend its market position
Kellanova is trading at $80.07 per share, or 21.2x forward P/E. Check out our free in-depth research report to learn more about why K doesn’t pass our bar.
Ford (F)
Rolling One-Year Beta: 0.64
Established to make automobiles accessible to a broader segment of the population, Ford (NYSE:F) designs, manufactures, and sells a variety of automobiles, trucks, and electric vehicles.
Why Should You Sell F?
- Flat vehicles sold over the past two years suggest it might have to lower prices to accelerate growth
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
- 9× net-debt-to-EBITDA ratio makes lenders less willing to extend additional capital, potentially necessitating dilutive equity offerings
Ford’s stock price of $11.35 implies a valuation ratio of 8.7x forward P/E. If you’re considering F for your portfolio, see our FREE research report to learn more.
AIG (AIG)
Rolling One-Year Beta: 0.54
With roots dating back to 1919 when it began as a small insurance agency in Shanghai, China, AIG (NYSE:AIG) is a global insurance organization that provides commercial and personal insurance solutions to businesses and individuals across more than 200 countries.
Why Is AIG Risky?
- Insurance products are facing significant market challenges during this cycle as net premiums earned has declined by 6.6% annually over the last five years
- Earnings growth over the last two years fell short of the peer group average as its EPS only increased by 1% annually
- Book value per share was flat over the last five years, indicating it’s failed to build equity value this cycle
At $78.13 per share, AIG trades at 1.1x forward P/B. Read our free research report to see why you should think twice about including AIG in your portfolio.
High-Quality Stocks for All Market Conditions
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 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
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.