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.

These stocks can be a rollercoaster, and StockStory is here to guide you through the ups and downs. Keeping that in mind, here are three volatile stocks to steer clear of and a few better alternatives.

The ONE Group (STKS)

Rolling One-Year Beta: 1.32

Doubling as a hospitality services provider for hotels and resorts, The One Group Hospitality (NASDAQ: STKS) is an upscale restaurant company that operates STK Steakhouse and Kona Grill.

Why Do We Think STKS Will Underperform?

1. Poor same-store sales performance over the past two years indicates it’s having trouble bringing new diners into its restaurants
2. Falling earnings per share over the last five years has some investors worried as stock prices ultimately follow EPS over the long term
3. High net-debt-to-EBITDA ratio of 7× increases the risk of forced asset sales or dilutive financing if operational performance weakens

At $5.13 per share, The ONE Group trades at 1.5x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than STKS.

Owens Corning (OC)

Rolling One-Year Beta: 1.22

Credited with the discovery of fiberglass, Owens Corning (NYSE: OC) supplies building and construction materials to the United States and international markets.

Why Do We Think Twice About OC?

1. Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
2. Estimated sales decline of 6.7% for the next 12 months implies a challenging demand environment
3. 4.8 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

Owens Corning is trading at $145.26 per share, or 9.8x forward P/E. Read our free research report to see why you should think twice about including OC in your portfolio.

Cognex (CGNX)

Rolling One-Year Beta: 1.29

Founded in 1981 when computer vision was in its infancy, Cognex (NASDAQ: CGNX) develops machine vision systems and software that help manufacturers and logistics companies automate quality inspection and tracking of products.

Why Should You Sell CGNX?

1. Sales were flat over the last two years, indicating it’s failed to expand this cycle
2. Free cash flow margin shrank by 12.2 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
3. Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned

Cognex’s stock price of $32.21 implies a valuation ratio of 36.1x forward P/E. If you’re considering CGNX for your portfolio, see our FREE research report to learn more.

High-Quality Stocks for All Market Conditions

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 9 Market-Beating Stocks. 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).

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