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. Keeping that in mind, here are three low-volatility stocks to steer clear of and a few better alternatives.
Bright Horizons (BFAM)
Rolling One-Year Beta: 0.63
Founded in 1986, Bright Horizons (NYSE: BFAM) is a global provider of child care, early education, and workforce support solutions.
Why Should You Sell BFAM?
- 14.1% annual revenue growth over the last five years was slower than its consumer discretionary peers
- Free cash flow margin is projected to show no improvement next year
- Improving returns on capital suggest management is identifying more profitable investments
Bright Horizons’s stock price of $66.85 implies a valuation ratio of 13.4x forward P/E. Read our free research report to see why you should think twice about including BFAM in your portfolio.
Exponent (EXPO)
Rolling One-Year Beta: 0.67
With a team of over 800 consultants holding advanced degrees in 90+ technical disciplines, Exponent (NASDAQ: EXPO) is a science and engineering consulting firm that investigates complex problems and provides expert analysis for clients across various industries.
Why Does EXPO Fall Short?
- Muted 3.9% annual revenue growth over the last two years shows its demand lagged behind its business services peers
- Smaller revenue base of $536.8 million means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
- Waning returns on capital imply its previous profit engines are losing steam
Exponent is trading at $69.33 per share, or 28x forward P/E. Check out our free in-depth research report to learn more about why EXPO doesn’t pass our bar.
Korn Ferry (KFY)
Rolling One-Year Beta: 0.75
With clients including 97% of the S&P 100 and operations in 103 offices across 51 countries, Korn Ferry (NYSE: KFY) is a global consulting firm that helps organizations design optimal structures, recruit talent, develop leaders, and create effective compensation strategies.
Why Is KFY Not Exciting?
- Sales were flat over the last two years, indicating it’s failed to expand this cycle
- Day-to-day expenses have swelled relative to revenue over the last five years as its adjusted operating margin fell by 3.3 percentage points
- Diminishing returns on capital suggest its earlier profit pools are drying up
At $61.23 per share, Korn Ferry trades at 11.3x forward P/E. To fully understand why you should be careful with KFY, check out our full research report (it’s free).
High-Quality Stocks for All Market Conditions
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 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.
