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 are three volatile stocks to avoid and some better opportunities instead.

The Honest Company (HNST)

Rolling One-Year Beta: 1.70

Co-founded by actress Jessica Alba, The Honest Company (NASDAQ: HNST) sells diapers and wipes, skin care products, and household cleaning products.

Why Should You Sell HNST?

1. Revenue base of $389.8 million puts it at a disadvantage compared to larger competitors exhibiting economies of scale
2. Capital intensity has ramped up over the last year as its free cash flow margin decreased by 6.6 percentage points
3. Negative returns on capital show management lost money while trying to expand the business

The Honest Company’s stock price of $3.55 implies a valuation ratio of 13.8x forward EV-to-EBITDA. Check out our free in-depth research report to learn more about why HNST doesn’t pass our bar.

Fluence Energy (FLNC)

Rolling One-Year Beta: 1.65

Pioneering the use of lithium-ion batteries for grid storage, Fluence (NASDAQ: FLNC) helps store renewable energy sources with battery systems.

Why Is FLNC Not Exciting?

1. Gross margin of 7.2% reflects its high production costs
2. 6.4 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
3. Short cash runway increases the probability of a capital raise that dilutes existing shareholders

At $15.60 per share, Fluence Energy trades at 54.9x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including FLNC in your portfolio.

Sphere Entertainment (SPHR)

Rolling One-Year Beta: 1.87

Famous for its viral Las Vegas Sphere venue, Sphere Entertainment (NYSE: SPHR) hosts live entertainment events and distributes content across various media platforms.

Why Are We Out on SPHR?

1. 7.6% annual revenue growth over the last five years was slower than its consumer discretionary peers
2. Cash-burning history makes us doubt the long-term viability of its business model
3. Limited cash reserves may force the company to seek unfavorable financing terms that could dilute shareholders

Sphere Entertainment is trading at $64.45 per share, or 12.5x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than SPHR.

Stocks We Like More

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at 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-micro-cap company Tecnoglass (+1,754% 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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