Market swings can be tough to stomach, and volatile stocks often experience exaggerated moves in both directions. While many thrive during risk-on environments, many also struggle to maintain investor confidence when the ride gets bumpy.
These stocks can be a rollercoaster, and StockStory is here to guide you through the ups and downs. Keeping that in mind, here is one volatile stock that could deliver huge gains and two best left to the gamblers.
Two Stocks to Sell:
Western Digital (WDC)
Rolling One-Year Beta: 2.11
Founded in 1970 by a Motorola employee, Western Digital (NASDAQ: WDC) is a leading producer of hard disk drives, SSDs and flash memory.
Why Do We Pass on WDC?
- Annual sales declines of 10.7% for the past five years show its products and services struggled to connect with the market during this cycle
- Negative 7.7% gross margin means it loses money on every sale and must pivot or scale quickly to survive
- Underwhelming 4.7% return on capital reflects management’s difficulties in finding profitable growth opportunities, and its falling returns suggest its earlier profit pools are drying up
At $86.27 per share, Western Digital trades at 15.3x forward P/E. If you’re considering WDC for your portfolio, see our FREE research report to learn more.
Viatris (VTRS)
Rolling One-Year Beta: 1.07
Created through the 2020 merger of Mylan and Pfizer's Upjohn division, Viatris (NASDAQ: VTRS) is a healthcare company that develops, manufactures, and distributes branded and generic medicines across more than 165 countries worldwide.
Why Do We Steer Clear of VTRS?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 4.9% annually over the last two years
- Issuance of new shares over the last five years caused its earnings per share to fall by 12% annually while its revenue grew
- Negative returns on capital show management lost money while trying to expand the business, and its shrinking returns suggest its past profit sources are losing steam
Viatris’s stock price of $10.56 implies a valuation ratio of 4.6x forward P/E. Read our free research report to see why you should think twice about including VTRS in your portfolio.
One Stock to Buy:
Sterling (STRL)
Rolling One-Year Beta: 2.39
Involved in the construction of a major highway, the Grand Parkway in Houston, TX, Sterling Infrastructure (NASDAQ: STRL) provides civil infrastructure construction.
Why Are We Bullish on STRL?
- 9.9% annual revenue growth over the last five years surpassed the sector average as its offerings resonated with customers
- Free cash flow margin expanded by 12.1 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
- Improving returns on capital reflect management’s ability to monetize investments
Sterling is trading at $275 per share, or 31x forward P/E. Is now a good time to buy? 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 6 Stocks for this week. 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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