Market swings can be tough to stomach, and volatile stocks often experience exaggerated moves in both directions. While many thrive during risk-on environments, many also struggle to maintain investor confidence when the ride gets bumpy.
At StockStory, our job is to help you avoid costly mistakes and stay on the right side of the trade. That said, here are three volatile stocks to avoid and some better opportunities instead.
8x8 (EGHT)
Rolling One-Year Beta: 1.64
Named after its founding year (1987) with "8x8" representing binary code for communications, 8x8 (NASDAQ: EGHT) provides cloud-based contact center and unified communications solutions that enable businesses to manage customer interactions and internal communications through a single platform.
Why Should You Dump EGHT?
- Customers had second thoughts about committing to its platform over the last year as its billings plateaued
- Sales are projected to be flat over the next 12 months and imply weak demand
- Long payback periods on sales and marketing expenses limit customer growth and signal the company operates in a highly competitive environment
8x8’s stock price of $2.08 implies a valuation ratio of 0.4x forward price-to-sales. To fully understand why you should be careful with EGHT, check out our full research report (it’s free for active Edge members).
RXO (RXO)
Rolling One-Year Beta: 2.08
With access to millions of trucks, RXO (NYSE: RXO) offers full-truckload, less-than-truckload, and last-mile deliveries.
Why Do We Think Twice About RXO?
- Forecasted revenue decline of 2.2% for the upcoming 12 months implies demand will fall off a cliff
- Day-to-day expenses have swelled relative to revenue over the last five years as its operating margin fell by 5 percentage points
- Earnings per share fell by 60.8% annually over the last two years while its revenue grew, showing its incremental sales were much less profitable
At $14.19 per share, RXO trades at 309.1x forward P/E. Read our free research report to see why you should think twice about including RXO in your portfolio.
EVgo (EVGO)
Rolling One-Year Beta: 1.46
Created through a settlement between NRG Energy and the California Public Utilities Commission, EVgo (NASDAQ: EVGO) is a provider of electric vehicle charging solutions, operating fast charging stations across the United States.
Why Does EVGO Fall Short?
- Poor expense management has led to operating margin losses
- Cash burn makes us question whether it can achieve sustainable long-term growth
- Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution
EVgo is trading at $3.10 per share, or 11.4x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than EVGO.
Stocks We Like More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check 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 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 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. Find your next big winner with StockStory today. Find your next big winner with StockStory today.
