A highly volatile stock can deliver big gains - or just as easily wipe out a portfolio if things go south. While some investors embrace risk, mistakes can be costly for those who aren’t prepared.
These stocks can be a rollercoaster, and StockStory is here to guide you through the ups and downs. That said, here are three volatile stocks best left to the gamblers and some better opportunities instead.
Universal Display (OLED)
Rolling One-Year Beta: 1.71
Serving major consumer electronics manufacturers, Universal Display (NASDAQ:OLED) is a provider of organic light emitting diode (OLED) technologies used in display and lighting applications.
Why Do We Think Twice About OLED?
- 4.3% annual revenue growth over the last two years was slower than its semiconductor peers
- Estimated sales growth of 4.2% for the next 12 months is soft and implies weaker demand
- 5.7 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
Universal Display is trading at $153.05 per share, or 33.1x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including OLED in your portfolio.
Royal Caribbean (RCL)
Rolling One-Year Beta: 1.74
Established in 1968, Royal Caribbean Cruises (NYSE:RCL) is a global cruise vacation company renowned for its innovative and exciting cruise experiences.
Why Does RCL Worry Us?
- Estimated sales growth of 10.1% for the next 12 months implies demand will slow from its two-year trend
- Capital intensity will likely ramp up in the next year as its free cash flow margin is expected to contract by 7.1 percentage points
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
Royal Caribbean’s stock price of $342.28 implies a valuation ratio of 22.3x forward P/E. Check out our free in-depth research report to learn more about why RCL doesn’t pass our bar.
Karat Packaging (KRT)
Rolling One-Year Beta: 1.22
Founded as Lollicup, Karat Packaging (NASDAQ: KRT) distributes and manufactures environmentally-friendly disposable foodservice packaging solutions.
Why Does KRT Give Us Pause?
- Muted 2.1% annual revenue growth over the last two years shows its demand lagged behind its industrials peers
- Earnings per share lagged its peers over the last two years as they only grew by 5.9% annually
- Low free cash flow margin of 4.4% for the last five years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
At $28.63 per share, Karat Packaging trades at 10.5x forward EV-to-EBITDA. If you’re considering KRT for your portfolio, see our FREE research report to learn more.
Stocks We Like More
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like 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 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% 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
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.