Stability is great, but low-volatility stocks may struggle to deliver market-beating returns over time as they sometimes underperform during bull markets.
Choosing the wrong investments can cause you to fall behind, which is why we started StockStory - to separate the winners from the losers. That said, here are three low-volatility stocks that don’t make the cut and some better opportunities instead.
Laureate Education (LAUR)
Rolling One-Year Beta: 0.15
Founded in 1998 by Douglas L. Becker and based in Miami, Laureate Education (NASDAQ:LAUR) is a global network of higher education institutions.
Why Do We Think LAUR Will Underperform?
- Demand for its offerings was relatively low as its number of enrolled students has underwhelmed
- Capital intensity will likely increase as its free cash flow margin is anticipated to drop by 1.7 percentage points over the next year
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
Laureate Education’s stock price of $38.31 implies a valuation ratio of 17.5x forward P/E. Dive into our free research report to see why there are better opportunities than LAUR.
S&P Global (SPGI)
Rolling One-Year Beta: 0.68
Tracing its roots back to 1860 when it published the first railroad industry manual, S&P Global (NYSE:SPGI) provides credit ratings, market intelligence, commodity data, automotive analytics, and financial indices that help investors and businesses make decisions.
Why Are We Wary of SPGI?
- Annual sales growth of 3.8% over the last two years lagged behind its financials peers as its large revenue base made it difficult to generate incremental demand
- Earnings growth over the last five years fell short of the peer group average as its EPS only increased by 8.5% annually
At $441.93 per share, S&P Global trades at 23.3x forward P/E. Read our free research report to see why you should think twice about including SPGI in your portfolio.
National Bank Holdings (NBHC)
Rolling One-Year Beta: 0.36
Operating under familiar local brands like Community Banks of Colorado, Bank Midwest, and Bank of Jackson Hole, National Bank Holdings (NYSE:NBHC) operates regional banks across Colorado, Kansas, Missouri, Wyoming, Texas, and other western states, offering commercial, business, and consumer banking services.
Why Are We Out on NBHC?
- Annual revenue growth of 6.1% over the last two years was below our standards for the banking sector
- Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 2.5% annually
- 1.8% annual tangible book value per share growth over the last five years was slower than its banking peers
National Bank Holdings is trading at $38.03 per share, or 1x forward P/B. Check out our free in-depth research report to learn more about why NBHC doesn’t pass our bar.
Stocks we like more
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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.