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. Keeping that in mind, here are three low-volatility stocks that don’t make the cut and some better opportunities instead.
Chewy (CHWY)
Rolling One-Year Beta: 0.51
Founded by Ryan Cohen, who later became known for his involvement in GameStop, Chewy (NYSE: CHWY) is an online retailer specializing in pet food, supplies, and healthcare services.
Why Does CHWY Fall Short?
- Scale is a double-edged sword because it limits the company’s growth potential compared to its smaller competitors, as reflected in its below-average annual revenue increases of 8.5% for the last three years
- Estimated sales growth of 6.1% for the next 12 months implies demand will slow from its three-year trend
- Gross margin of 29.4% is below its competitors, leaving less money to invest in areas like marketing and R&D
At $32.32 per share, Chewy trades at 16.4x forward EV/EBITDA. Check out our free in-depth research report to learn more about why CHWY doesn’t pass our bar.
Western Union (WU)
Rolling One-Year Beta: 0.33
With a history dating back to 1851 when it began as a telegraph company, Western Union (NYSE: WU) is a global money transfer service that enables consumers and businesses to send funds across borders and currencies, typically within minutes.
Why Do We Pass on WU?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 2.9% annually over the last five years
- Earnings per share have contracted by 1.1% annually over the last five years, a headwind for returns as stock prices often echo long-term EPS performance
Western Union is trading at $9.61 per share, or 5.5x forward P/E. If you’re considering WU for your portfolio, see our FREE research report to learn more.
FirstCash (FCFS)
Rolling One-Year Beta: -0.02
Offering a financial lifeline to the unbanked and credit-constrained since 1988, FirstCash (NASDAQ: FCFS) operates pawn stores across the U.S. and Latin America while also providing retail point-of-sale payment solutions for credit-constrained consumers.
Why Does FCFS Give Us Pause?
- Muted 6.9% annual revenue growth over the last two years shows its demand lagged behind its financials peers
- Loan losses and capital returns have eroded its tangible book value per share this cycle as its tangible book value per share declined by 159% annually over the last five years
FirstCash’s stock price of $162.01 implies a valuation ratio of 16.5x forward P/E. To fully understand why you should be careful with FCFS, check out our full research report (it’s free for active Edge members).
Stocks We Like More
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 6 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 Exlservice (+354% 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.
