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.
Navigating these stocks isn’t easy, which is why StockStory helps you find Comfort In Chaos. That said, here is one volatile stock that could reward patient investors and two that could just as easily collapse.
Two Stocks to Sell:
Udemy (UDMY)
Rolling One-Year Beta: 1.31
With courses ranging from investing to cooking to computer programming, Udemy (NASDAQ:UDMY) is an online learning platform that connects learners with expert instructors who specialize in a wide range of topics.
Why Does UDMY Worry Us?
- Customer spending has dipped by 1.7% on average as it focused on growing its buyers
- Projected sales are flat for the next 12 months, implying demand will slow from its three-year trend
- Expensive marketing campaigns hurt its profitability and make us wonder what would happen if it let up on the gas
Udemy’s stock price of $5.78 implies a valuation ratio of 5.9x forward EV/EBITDA. Read our free research report to see why you should think twice about including UDMY in your portfolio.
Red Robin (RRGB)
Rolling One-Year Beta: 2.39
Known for its bottomless steak fries, Red Robin (NASDAQ:RRGB) is a chain of casual restaurants specializing in burgers and general American fare.
Why Should You Sell RRGB?
- Disappointing same-store sales over the past two years show customers aren’t responding well to its menu offerings and dining experience
- Falling earnings per share over the last six years has some investors worried as stock prices ultimately follow EPS over the long term
- High net-debt-to-EBITDA ratio of 9× increases the risk of forced asset sales or dilutive financing if operational performance weakens
At $4.22 per share, Red Robin trades at 9.1x forward EV-to-EBITDA. Check out our free in-depth research report to learn more about why RRGB doesn’t pass our bar.
One Stock to Buy:
Zscaler (ZS)
Rolling One-Year Beta: 1.24
Pioneering the "zero trust" approach that has fundamentally changed enterprise network security, Zscaler (NASDAQ:ZS) provides a cloud-based security platform that connects users, devices, and applications securely without traditional network-based security hardware.
Why Do We Love ZS?
- Billings have averaged 26.3% growth over the last year, showing it’s securing new contracts that could potentially increase in value over time
- Projected revenue growth of 21.6% for the next 12 months suggests its momentum from the last two years will persist
- Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends
Zscaler is trading at $229.34 per share, or 10.7x forward price-to-sales. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free for active Edge members .
Stocks We Like Even 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 5 Strong Momentum 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.