A stock with low volatility can be reassuring, but it doesn’t always mean strong long-term performance. Investors who prioritize stability may miss out on higher-reward opportunities elsewhere.
Choosing the wrong investments can cause you to fall behind, which is why we started StockStory - to separate the winners from the losers. Keeping that in mind, here are three low-volatility stocks to steer clear of and a few better alternatives.
MGP Ingredients (MGPI)
Rolling One-Year Beta: 0.79
Headquartered in Atchison, Kansas, MGP Ingredients (NASDAQ: MGPI) is a leading supplier of high-quality ingredients to the food and beverage industry
Why Should You Dump MGPI?
- Annual sales declines of 2.8% for the past three years show its products struggled to connect with the market
- Sales are projected to tank by 19.8% over the next 12 months as its demand continues evaporating
- Operating profits fell over the last year as its sales dropped and it struggled to adjust its fixed costs
At $33 per share, MGP Ingredients trades at 12.4x forward P/E. Check out our free in-depth research report to learn more about why MGPI doesn’t pass our bar.
Casella Waste Systems (CWST)
Rolling One-Year Beta: 0.44
Starting with the founder picking up garbage with a pickup truck he purchased using savings from high school, Casella (NASDAQ: CWST) offers waste management services for businesses, residents, and the government.
Why Are We Cautious About CWST?
- Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
- Expenses have increased as a percentage of revenue over the last five years as its operating margin fell by 4 percentage points
- Issuance of new shares partly offset its revenue growth over the last two years as its earnings per share were flat
Casella Waste Systems’s stock price of $114.68 implies a valuation ratio of 98.1x forward P/E. If you’re considering CWST for your portfolio, see our FREE research report to learn more.
Privia Health (PRVA)
Rolling One-Year Beta: 0.68
Operating in 13 states and the District of Columbia with over 4,300 providers serving more than 4.8 million patients, Privia Health (NASDAQ: PRVA) is a technology-driven company that helps physicians optimize their practices, improve patient experiences, and transition to value-based care models.
Why Does PRVA Give Us Pause?
- Modest revenue base of $1.80 billion gives it less fixed cost leverage and fewer distribution channels than larger companies
- Low free cash flow margin of 4.6% for the last five years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
- Negative returns on capital show management lost money while trying to expand the business
Privia Health is trading at $25.02 per share, or 29.3x forward P/E. Dive into our free research report to see why there are better opportunities than PRVA.
Stocks We Like More
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.
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.
