Stability is great, but low-volatility stocks may struggle to deliver market-beating returns over time as they sometimes underperform during bull markets.
Luckily for you, StockStory helps you navigate which companies are truly worth holding. That said, here is one low-volatility stock that could offer consistent gains and two that may not deliver the returns you need.
Two Stocks to Sell:
Keurig Dr Pepper (KDP)
Rolling One-Year Beta: 0.15
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 Does KDP Worry Us?
- Large revenue base makes it harder to increase sales quickly, and its annual revenue growth of 6.5% over the last three years was below our standards for the consumer staples sector
- Expenses have increased as a percentage of revenue over the last year as its operating margin fell by 5.7 percentage points
- ROIC of 5.7% reflects management’s challenges in identifying attractive investment opportunities
Keurig Dr Pepper is trading at $32.63 per share, or 15.8x forward P/E. Dive into our free research report to see why there are better opportunities than KDP.
Charles River Laboratories (CRL)
Rolling One-Year Beta: 0.39
Named after the Massachusetts river where it was founded in 1947, Charles River Laboratories (NYSE: CRL) provides non-clinical drug development services, research models, and manufacturing support to pharmaceutical and biotechnology companies.
Why Are We Hesitant About CRL?
- Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
- Forecasted revenue decline of 2.6% for the upcoming 12 months implies demand will fall off a cliff
- Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value
Charles River Laboratories’s stock price of $140 implies a valuation ratio of 14.8x forward P/E. To fully understand why you should be careful with CRL, check out our full research report (it’s free).
One Stock to Watch:
Ross Stores (ROST)
Rolling One-Year Beta: 0.65
Selling excess inventory or overstocked items from other retailers, Ross Stores (NASDAQ: ROST) is an off-price concept that sells apparel and other goods at prices much lower than department stores.
Why Could ROST Be a Winner?
- Offensive push to build new stores and attack its untapped market opportunities is backed by its same-store sales growth
- Same-store sales growth averaged 3.5% over the past two years, showing it’s bringing new and repeat shoppers into its stores
- Stellar returns on capital showcase management’s ability to surface highly profitable business ventures, and its returns are climbing as it finds even more attractive growth opportunities
At $142.24 per share, Ross Stores trades at 21.6x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
High-Quality Stocks for All Market Conditions
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 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-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free.
