Volatility cuts both ways - while it creates opportunities, it also increases risk, making sharp declines just as likely as big gains. This unpredictability can shake out even the most experienced investors.
At StockStory, our job is to help you avoid costly mistakes and stay on the right side of the trade. Keeping that in mind, here is one volatile stock that could reward patient investors and two that could just as easily collapse.
Two Stocks to Sell:
Coty (COTY)
Rolling One-Year Beta: 1.45
With a portfolio boasting many household brands, Coty (NYSE: COTY) is a beauty products powerhouse spanning cosmetics, fragrances, and skincare.
Why Do We Avoid COTY?
- Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
- Forecasted revenue decline of 1.2% for the upcoming 12 months implies demand will fall off a cliff
- Revenue growth over the past three years was nullified by the company’s new share issuances as its earnings per share fell by 26.6% annually
Coty’s stock price of $2.44 implies a valuation ratio of 7.7x forward P/E. If you’re considering COTY for your portfolio, see our FREE research report to learn more.
Norwegian Cruise Line (NCLH)
Rolling One-Year Beta: 1.22
With amenities like a full go-kart race track built into its ships, Norwegian Cruise Line (NYSE: NCLH) is a premier global cruise company.
Why Should You Sell NCLH?
- Number of passenger cruise days has disappointed over the past two years, indicating weak demand for its offerings
- Negative free cash flow margin is anticipated to improve next year, providing investors a ray of hope that it can one day become financially independent
- Short cash runway increases the probability of a capital raise that dilutes existing shareholders
Norwegian Cruise Line is trading at $14.16 per share, or 11.3x forward P/E. Dive into our free research report to see why there are better opportunities than NCLH.
One Stock to Watch:
Garrett Motion (GTX)
Rolling One-Year Beta: 1.05
A key player in the transition to cleaner vehicles, Garrett Motion (NYSE: GTX) designs and manufactures turbochargers, air compressors, and electric motor technologies for vehicle manufacturers and industrial applications.
Why Are We Fans of GTX?
- Earnings growth has trumped its peers over the last two years as its EPS has compounded at 44.4% annually
- Free cash flow margin expanded by 6.8 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
- Returns on capital are growing as management capitalizes on its market opportunities
At $26.27 per share, Garrett Motion trades at 8.8x forward EV-to-EBITDA. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.
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 Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.
