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 are three volatile stocks to steer clear of and a few better alternatives.
Teradyne (TER)
Rolling One-Year Beta: 1.37
Sporting most major chip manufacturers as its customers, Teradyne (NASDAQ:TER) is a US-based supplier of automated test equipment for semiconductors as well as other technologies and devices.
Why Is TER Not Exciting?
- Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last five years
- Efficiency has decreased over the last five years as its operating margin fell by 14.4 percentage points
- Performance over the past five years shows each sale was less profitable, as its earnings per share fell by 4.4% annually
At $119.53 per share, Teradyne trades at 30x forward P/E. Dive into our free research report to see why there are better opportunities than TER.
Ryder (R)
Rolling One-Year Beta: 1.22
As one of the first companies to introduce the idea of leasing trucks, Ryder (NYSE:R) provides rental vehicles to businesses and delivers packages directly to homes or businesses.
Why Are We Out on R?
- 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 3% for the last two years
- Earnings per share have dipped by 7.4% annually over the past two years, which is concerning because stock prices follow EPS over the long term
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 9.5 percentage points
Ryder’s stock price of $185.63 implies a valuation ratio of 13.2x forward P/E. Read our free research report to see why you should think twice about including R in your portfolio.
Fulton Financial (FULT)
Rolling One-Year Beta: 1.30
Tracing its roots back to 1882 in the heart of Pennsylvania, Fulton Financial (NASDAQ:FULT) is a financial holding company that provides banking, lending, and wealth management services to consumers and businesses across five Mid-Atlantic states.
Why Do We Think Twice About FULT?
- Estimated net interest income growth of 1.9% for the next 12 months implies demand will slow from its five-year trend
- Projected 2.8 percentage point efficiency ratio increase over the next year signals its day-to-day expenses will rise
- Capital trends were unexciting over the last five years as its 4.3% annual tangible book value per share growth was below the typical banking firm
Fulton Financial is trading at $19.47 per share, or 1.1x forward P/B. Dive into our free research report to see why there are better opportunities than FULT.
Stocks We Like More
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
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