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.
Navigating these stocks isn’t easy, which is why StockStory helps you find Comfort In Chaos. Keeping that in mind, here are three volatile stocks to steer clear of and a few better alternatives.
AAON (AAON)
Rolling One-Year Beta: 1.30
Backed by two million square feet of lab testing space, AAON (NASDAQ: AAON) makes heating, ventilation, and air conditioning equipment for different types of buildings.
Why Are We Hesitant About AAON?
- Day-to-day expenses have swelled relative to revenue over the last five years as its operating margin fell by 6 percentage points
- Earnings per share fell by 22.7% annually over the last two years while its revenue grew, showing its incremental sales were much less profitable
- Free cash flow margin dropped by 27.2 percentage points over the last five years, implying the company became more capital intensive as competition picked up
AAON’s stock price of $91.65 implies a valuation ratio of 47.9x forward P/E. Dive into our free research report to see why there are better opportunities than AAON.
KeyCorp (KEY)
Rolling One-Year Beta: 1.21
Tracing its roots back to 1849 during the California Gold Rush era, KeyCorp (NYSE: KEY) operates KeyBank, a full-service regional bank providing retail and commercial banking, wealth management, and investment services across 15 states.
Why Does KEY Give Us Pause?
- Net interest income trends were unexciting over the last five years as its 2.9% annual growth was below the typical banking firm
- Net interest margin of 2.4% reflects its high servicing and capital costs
- Flat tangible book value per share over the last five years suggest it must find different ways to enhance shareholder value during this cycle
At $21.49 per share, KeyCorp trades at 1.3x forward P/B. Read our free research report to see why you should think twice about including KEY in your portfolio.
Bank of America (BAC)
Rolling One-Year Beta: 1.38
Tracing its roots back to 1784 and now serving approximately 67 million consumer and small business clients, Bank of America (NYSE: BAC) is a global financial institution that provides banking, investing, asset management, and risk management products and services to individuals, businesses, and governments.
Why Are We Wary of BAC?
- Scale is a double-edged sword because it limits the firm’s growth potential compared to its smaller competitors, as reflected in its below-average annual net interest income increases of 6.7% for the last five years
- Net interest margin of 2% is well below other banks, signaling its loans aren’t very profitable
- Estimated tangible book value per share growth of 6.1% for the next 12 months implies profitability will slow from its two-year trend
Bank of America is trading at $53.16 per share, or 1.3x forward P/B. Check out our free in-depth research report to learn more about why BAC doesn’t pass our bar.
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 5 Strong Momentum Stocks for this week. 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.
