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. That said, here are three low-volatility stocks to steer clear of and a few better alternatives.
United Parcel Service (UPS)
Rolling one-year beta: 0.36
Trademarking its recognizable UPS Brown color, UPS (NYSE: UPS) offers package delivery, supply chain management, and freight forwarding services.
Why Is UPS Risky?
- Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last five years
- Sales over the last five years were less profitable as its earnings per share fell by 9.2% annually while its revenue was flat
- Diminishing returns on capital suggest its earlier profit pools are drying up
United Parcel Service is trading at $110.92 per share, or 14.3x forward P/E. Check out our free in-depth research report to learn more about why UPS doesn’t pass our bar.
MarketAxess (MKTX)
Rolling one-year beta: 0.58
Pioneering the shift from phone-based to electronic bond trading since 2000, MarketAxess (NASDAQ: MKTX) operates electronic trading platforms that enable institutional investors and broker-dealers to efficiently trade fixed-income securities like corporate and government bonds.
Why Should You Sell MKTX?
- Muted 3.6% annual revenue growth over the last two years shows its demand lagged behind its financials peers
- Incremental sales over the last five years were less profitable as its earnings per share were flat while its revenue grew
MarketAxess’s stock price of $165.56 implies a valuation ratio of 19.3x forward P/E. Dive into our free research report to see why there are better opportunities than MKTX.
Sallie Mae (SLM)
Rolling one-year beta: 0.70
Originally created as a government-sponsored enterprise before privatizing in 2004, Sallie Mae (NASDAQ: SLM) is a financial services company that provides private education loans, savings products, and educational resources to help students and families pay for college.
Why Are We Bearish on SLM?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 1.3% annually over the last five years
- Sales were less profitable over the last five years as its earnings per share fell by 5.3% annually, worse than its revenue declines
At $17.53 per share, Sallie Mae trades at 7x forward P/E. If you’re considering SLM for your portfolio, see our FREE research report to learn more.
Stocks we like more
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.
