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.
Five Below (FIVE)
Rolling One-Year Beta: 2.11
Often facilitating a treasure hunt shopping experience, Five Below (NASDAQ: FIVE) is an American discount retailer that sells a variety of products from mobile phone cases to candy to sports equipment for largely $5 or less.
Why Are We Cautious About FIVE?
- Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
- Widely-available products (and therefore stiff competition) result in an inferior gross margin of 35.1% that must be offset through higher volumes
- Low returns on capital reflect management’s struggle to allocate funds effectively, and its falling returns suggest its earlier profit pools are drying up
At $164.62 per share, Five Below trades at 31.2x forward P/E. Dive into our free research report to see why there are better opportunities than FIVE.
Advanced Energy (AEIS)
Rolling One-Year Beta: 1.94
Pioneering technologies for radio frequency power delivery, Advanced Energy (NASDAQ: AEIS) provides power supplies, thermal management systems, and measurement and control instruments for various manufacturing processes.
Why Do We Think AEIS Will Underperform?
- Flat sales over the last two years suggest it must find different ways to grow during this cycle
- Expenses have increased as a percentage of revenue over the last five years as its operating margin fell by 3.1 percentage points
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
Advanced Energy’s stock price of $206.63 implies a valuation ratio of 28.2x forward P/E. If you’re considering AEIS for your portfolio, see our FREE research report to learn more.
Jackson Financial (JXN)
Rolling One-Year Beta: 1.48
Spun off from British insurer Prudential plc in 2021 after more than 60 years as its U.S. subsidiary, Jackson Financial (NYSE: JXN) offers annuity products and retirement solutions that help Americans grow and protect their retirement savings and income.
Why Do We Think Twice About JXN?
- 2.5% annualized net premiums earned growth over the last two years lagged behind its insurance peers
- Efficiency has decreased over the last four years as its pre-tax profit margin fell by 34.5 percentage points
- Falling earnings per share over the last four years has some investors worried as stock prices ultimately follow EPS over the long term
Jackson Financial is trading at $98.39 per share, or 0.6x forward P/B. Read our free research report to see why you should think twice about including JXN in your portfolio.
High-Quality Stocks for All Market Conditions
The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
