Stability is great, but low-volatility stocks may struggle to deliver market-beating returns over time as they sometimes underperform during bull markets.
Luckily for you, StockStory helps you navigate which companies are truly worth holding. That said, here are three low-volatility stocks to avoid and some better opportunities instead.
Perdoceo Education (PRDO)
Rolling One-Year Beta: 0.63
Formerly known as Career Education Corporation, Perdoceo Education (NASDAQ: PRDO) is an educational services company that specializes in postsecondary education.
Why Are We Cautious About PRDO?
- Sales trends were unexciting over the last two years as its 2.9% annual growth was below the typical consumer discretionary company
- Eroding returns on capital suggest its historical profit centers are aging
Perdoceo Education’s stock price of $33.06 implies a valuation ratio of 21.1x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including PRDO in your portfolio.
Solventum (SOLV)
Rolling One-Year Beta: 0.80
Founded in 1985, Solventum (NYSE: SOLV) develops, manufactures, and commercializes a portfolio of healthcare products and services addressing critical customer and therapeutic patient needs.
Why Are We Wary of SOLV?
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Efficiency has decreased over the last four years as its adjusted operating margin fell by 5.3 percentage points
- 15.7 percentage point decline in its free cash flow margin over the last four years reflects the company’s increased investments to defend its market position
Solventum is trading at $72.14 per share, or 12.9x forward P/E. To fully understand why you should be careful with SOLV, check out our full research report (it’s free).
AdaptHealth (AHCO)
Rolling One-Year Beta: 0.36
With a network of approximately 680 locations serving patients across all 50 states, AdaptHealth (NASDAQ: AHCO) provides home medical equipment, supplies, and related services to patients with chronic conditions like sleep apnea, diabetes, and respiratory disorders.
Why Does AHCO Give Us Pause?
- Sales trends were unexciting over the last two years as its 2.7% annual growth was below the typical healthcare company
- Performance over the past five years shows its incremental sales were less profitable as its earnings per share were flat
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
At $9.25 per share, AdaptHealth trades at 7.6x forward P/E. If you’re considering AHCO for your portfolio, see our FREE research report to learn more.
Stocks We Like More
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound 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 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-small-cap company Comfort Systems (+782% 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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