A highly volatile stock can deliver big gains - or just as easily wipe out a portfolio if things go south. While some investors embrace risk, mistakes can be costly for those who aren’t prepared.
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 that could deliver huge gains and two best left to the gamblers.
Two Stocks to Sell:
Knight-Swift Transportation (KNX)
Rolling One-Year Beta: 1.27
Covering 1.6 billion loaded miles in 2023 alone, Knight-Swift Transportation (NYSE: KNX) offers less-than-truckload and full truckload delivery services.
Why Do We Think KNX Will Underperform?
- 4.3% annual revenue growth over the last two years was slower than its industrials peers
- 9.1 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
Knight-Swift Transportation’s stock price of $45.55 implies a valuation ratio of 24.9x forward P/E. Dive into our free research report to see why there are better opportunities than KNX.
Shyft (SHYF)
Rolling One-Year Beta: 1.12
Notably receiving an order from FedEx for electric vehicles, Shyft (NASDAQ: SHYF) offers specialty vehicles and truck bodies for various industries.
Why Should You Dump SHYF?
- Sales tumbled by 13.7% annually over the last two years, showing market trends are working against its favor during this cycle
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 6.8 percentage points
- Waning returns on capital imply its previous profit engines are losing steam
At $12.54 per share, Shyft trades at 11.7x forward P/E. Check out our free in-depth research report to learn more about why SHYF doesn’t pass our bar.
One Stock to Buy:
DexCom (DXCM)
Rolling One-Year Beta: 1.20
Founded in 1999 and receiving its first FDA approval in 2006, DexCom (NASDAQ: DXCM) develops and sells continuous glucose monitoring systems that allow people with diabetes to track their blood sugar levels without repeated finger pricks.
Why Are We Bullish on DXCM?
- Core business can prosper without any help from acquisitions as its organic revenue growth averaged 19.2% over the past two years
- Incremental sales over the last five years have been highly profitable as its earnings per share increased by 23.2% annually, topping its revenue gains
- Industry-leading 24.8% return on capital demonstrates management’s skill in finding high-return investments
DexCom is trading at $86.74 per share, or 40.5x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Trump’s April 2024 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 5 Strong Momentum 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 Comfort Systems (+782% 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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