Volatility cuts both ways - while it creates opportunities, it also increases risk, making sharp declines just as likely as big gains. This unpredictability can shake out even the most experienced investors.
At StockStory, our job is to help you avoid costly mistakes and stay on the right side of the trade. That said, here is one volatile stock that could deliver huge gains and two that could just as easily collapse.
Two Stocks to Sell:
Commvault (CVLT)
Rolling One-Year Beta: 1.28
Born from the need to create ironclad protection in an increasingly dangerous digital world, Commvault (NASDAQ: CVLT) provides data protection and cyber resilience software that helps organizations secure, back up, and recover their data across on-premises, hybrid, and multi-cloud environments.
Why Does CVLT Give Us Pause?
- Annual revenue growth of 9.1% over the last five years was well below our standards for the software sector
- Estimated sales growth of 13.2% for the next 12 months implies demand will slow from its two-year trend
- Costs have risen faster than its revenue over the last year, causing its operating margin to decline by 1.1 percentage points
At $173.49 per share, Commvault trades at 6.5x forward price-to-sales. If you’re considering CVLT for your portfolio, see our FREE research report to learn more.
Estée Lauder (EL)
Rolling One-Year Beta: 1.47
Named after its founder, who was an entrepreneurial woman from New York with a passion for skincare, Estée Lauder (NYSE: EL) is a one-stop beauty shop with products in skincare, fragrance, makeup, sun protection, and men’s grooming.
Why Is EL Not Exciting?
- 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
- Inability to adjust its cost structure while its revenue declined over the last year led to a 11.7 percentage point drop in the company’s operating margin
- Sales were less profitable over the last three years as its earnings per share fell by 40.8% annually, worse than its revenue declines
Estée Lauder’s stock price of $96.80 implies a valuation ratio of 46.2x forward P/E. Read our free research report to see why you should think twice about including EL in your portfolio.
One Stock to Buy:
EMCOR (EME)
Rolling One-Year Beta: 1.49
Through its network of over 70 subsidiaries, EMCOR (NYSE: EME) provides electrical, mechanical, and building construction and services
Why Will EME Outperform?
- Market share has increased this cycle as its 15.6% annual revenue growth over the last two years was exceptional
- Share repurchases over the last two years enabled its annual earnings per share growth of 54.8% to outpace its revenue gains
- Rising returns on capital show management is finding more attractive investment opportunities
EMCOR is trading at $685.95 per share, or 26.6x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.
Stocks We Like Even More
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-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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