Low-volatility stocks may offer stability, but that often comes at the cost of slower growth and the upside potential of more dynamic companies.
Finding the right balance between safety and returns isn’t easy, which is why StockStory is here to help. That said, here are three low-volatility stocks that don’t make the cut and some better opportunities instead.
Monarch (MCRI)
Rolling One-Year Beta: 0.80
Established in 1993, Monarch (NASDAQ: MCRI) operates luxury casinos and resorts, offering high-end gaming, dining, and hospitality experiences.
Why Does MCRI Give Us Pause?
- 4% annual revenue growth over the last two years was slower than its consumer discretionary peers
- Anticipated sales growth of 4.4% for the next year implies demand will be shaky
At $103.33 per share, Monarch trades at 20.7x forward P/E. Check out our free in-depth research report to learn more about why MCRI doesn’t pass our bar.
D.R. Horton (DHI)
Rolling One-Year Beta: 0.47
One of the largest homebuilding companies in the U.S., D.R. Horton (NYSE: DHI) builds a variety of new construction homes across multiple markets.
Why Are We Cautious About DHI?
- Backlog has dropped by 17% on average over the past two years, suggesting it’s losing orders as competition picks up
- Earnings per share have contracted by 5.8% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance
- Eroding returns on capital suggest its historical profit centers are aging
D.R. Horton’s stock price of $142.17 implies a valuation ratio of 12.1x forward P/E. If you’re considering DHI for your portfolio, see our FREE research report to learn more.
Gartner (IT)
Rolling One-Year Beta: 0.84
With over 2,500 research experts guiding organizations through complex technology landscapes, Gartner (NYSE: IT) provides research, advisory services, and conferences that help executives make better decisions about technology and other business priorities.
Why Do We Think Twice About IT?
- Earnings per share lagged its peers over the last two years as they only grew by 9.3% annually
Gartner is trading at $343.12 per share, or 27.7x forward P/E. Dive into our free research report to see why there are better opportunities than IT.
High-Quality Stocks for All Market Conditions
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