Low-volatility stocks may offer stability, but that often comes at the cost of slower growth and the upside potential of more dynamic companies.
Choosing the wrong investments can cause you to fall behind, which is why we started StockStory - to separate the winners from the losers. Keeping that in mind, here is one low-volatility stock providing safe-and-steady growth and two that may not deliver the returns you need.
Two Stocks to Sell:
CarMax (KMX)
Rolling One-Year Beta: 0.71
Known for its transparent, customer-centric approach and wide selection of vehicles, Carmax (NYSE:KMX) is the largest automotive retailer in the United States.
Why Is KMX Risky?
- Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new locations
- Commoditized inventory, bad unit economics, and high competition are reflected in its low gross margin of 11%
- 16× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly
At $46.98 per share, CarMax trades at 19.7x forward P/E. Check out our free in-depth research report to learn more about why KMX doesn’t pass our bar.
RTX (RTX)
Rolling One-Year Beta: 0.81
Originally focused on refrigeration technology, Raytheon (NSYE:RTX) provides a a variety of products and services to the aerospace and defense industries.
Why Are We Hesitant About RTX?
- 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 6.5% for the last five years
- Estimated sales growth of 5.4% for the next 12 months implies demand will slow from its two-year trend
- Underwhelming 4.5% return on capital reflects management’s difficulties in finding profitable growth opportunities
RTX is trading at $199.25 per share, or 28.7x forward P/E. Dive into our free research report to see why there are better opportunities than RTX.
One Stock to Watch:
Waste Management (WM)
Rolling One-Year Beta: -0.02
Headquartered in Houston, Waste Management (NYSE:WM) is a provider of comprehensive waste management services in North America.
Why Could WM Be a Winner?
- Annual revenue growth of 11.1% over the past two years was outstanding, reflecting market share gains this cycle
- Offerings are mission-critical for businesses and result in a premier gross margin of 38.9%
- Highly efficient business model is illustrated by its impressive 17.4% operating margin
Waste Management’s stock price of $227.05 implies a valuation ratio of 27.7x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
High-Quality Stocks for All Market Conditions
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in 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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.