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. Keeping that in mind, here is one volatile stock that could deliver huge gains and two that might not be worth the risk.
Two Stocks to Sell:
BeautyHealth (SKIN)
Rolling One-Year Beta: 1.92
Operating in the emerging beauty health category, the appropriately named BeautyHealth (NASDAQ: SKIN) is a skincare company best known for its Hydrafacial product that cleanses and hydrates skin.
Why Do We Pass on SKIN?
- Sales tumbled by 1.6% annually over the last three years, showing consumer trends are working against its favor
- Subscale operations are evident in its revenue base of $310.1 million, meaning it has fewer distribution channels than its larger rivals
- Historical operating margin losses point to an inefficient cost structure
At $2.22 per share, BeautyHealth trades at 14.4x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including SKIN in your portfolio.
Napco (NSSC)
Rolling One-Year Beta: 1.65
Protecting everything from schools to government facilities since 1969, Napco Security Technologies (NASDAQ: NSSC) manufactures electronic security devices, access control systems, and communication services for intrusion and fire alarm systems.
Why Are We Cautious About NSSC?
- Muted 3.7% annual revenue growth over the last two years shows its demand lagged behind its business services peers
- Smaller revenue base of $181.2 million means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
- Demand will likely fall over the next 12 months as Wall Street expects flat revenue
Napco’s stock price of $30.49 implies a valuation ratio of 26.1x forward P/E. If you’re considering NSSC for your portfolio, see our FREE research report to learn more.
One Stock to Buy:
Palantir Technologies (PLTR)
Rolling One-Year Beta: 2.34
Named after the all-seeing stones in "Lord of the Rings," Palantir Technologies (NASDAQ: PLTR) develops software platforms that help government agencies and enterprises integrate, analyze, and operationalize their data for decision-making.
Why Should You Buy PLTR?
- Average billings growth of 44.2% over the last year enhances its liquidity and shows there is steady demand for its products
- User-friendly software enables clients to ramp up spending quickly, leading to the speedy recovery of customer acquisition costs
- Strong free cash flow margin of 55% enables it to reinvest or return capital consistently
Palantir Technologies is trading at $177.33 per share, or 92.9x forward price-to-sales. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check 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 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-micro-cap company Kadant (+351% 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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