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.
These stocks can be a rollercoaster, and StockStory is here to guide you through the ups and downs. Keeping that in mind, here are two volatile stocks that could reward patient investors and one best left to the gamblers.
One Stock to Sell:
Stitch Fix (SFIX)
Rolling One-Year Beta: 2.73
One of the original subscription box companies, Stitch Fix (NASDAQ: SFIX) is an online personal styling and fashion service that curates personalized clothing selections for customers.
Why Should You Sell SFIX?
- Demand for its offerings was relatively low as its number of active clients has underwhelmed
- Poor expense management has led to operating losses
- Earnings per share decreased by more than its revenue over the last five years, showing each sale was less profitable
Stitch Fix is trading at $3.28 per share, or 11.6x forward EV-to-EBITDA. Check out our free in-depth research report to learn more about why SFIX doesn’t pass our bar.
Two Stocks to Watch:
Deckers (DECK)
Rolling One-Year Beta: 1.41
Established in 1973, Deckers (NYSE: DECK) is a footwear and apparel conglomerate with a portfolio of lifestyle and performance brands.
Why Does DECK Stand Out?
- Brand and reputation resonate with consumers, as seen in its above-market 18% annual sales growth over the last five years
- Free cash flow margin is on track to jump by 2.9 percentage points next year, meaning the company will have more resources to pursue growth initiatives, repurchase shares, or pay dividends
- Returns on capital are growing as management capitalizes on its market opportunities
At $118.39 per share, Deckers trades at 18.4x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Planet Labs (PL)
Rolling One-Year Beta: 2.79
Pioneering the concept of "agile aerospace" with hundreds of small but powerful satellites, Planet Labs (NYSE: PL) operates the world's largest fleet of Earth observation satellites, capturing daily images of our planet to provide insights on deforestation, agriculture, and climate change.
Why Is PL a Top Pick?
- Market share has increased this cycle as its 20.6% annual revenue growth over the last five years was exceptional
- Earnings per share have massively outperformed its peers over the last four years, increasing by 49% annually
- Cash burn has decreased over the last five years, showing the company is becoming a more self-sustaining business
Planet Labs’s stock price of $3.47 implies a valuation ratio of 74.2x forward EV-to-EBITDA. Is now a good time to buy? See for yourself in our full research report, it’s free.
Stocks We Like Even More
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market 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 175% over the last five years.
Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Sterling Infrastructure (+1,096% five-year return). Find your next big winner with StockStory today for free.
