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 with massive upside potential and two that could just as easily collapse.
Two Stocks to Sell:
ACV Auctions (ACVA)
Rolling One-Year Beta: 1.34
Founded in 2014, ACV Auctions (NASDAQ: ACVA) is an online auction marketplace for car dealers and wholesalers to buy and sell used cars.
Why Are We Wary of ACVA?
- High servicing costs result in an inferior gross margin of 25.1% that must be offset through higher volumes
- Highly competitive market means it’s on the never-ending treadmill of sales and marketing spend
- Low free cash flow margin of 0.3% for the last two years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
ACV Auctions’s stock price of $15.72 implies a valuation ratio of 29.4x forward EV/EBITDA. If you’re considering ACVA for your portfolio, see our FREE research report to learn more.
Neogen (NEOG)
Rolling One-Year Beta: 1.26
Founded in 1981 and operating at the intersection of food safety and animal health, Neogen (NASDAQ: NEOG) develops and manufactures diagnostic tests and related products to detect dangerous substances in food and pharmaceuticals for animal health.
Why Do We Pass on NEOG?
- Earnings per share fell by 7.3% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
- Unfavorable liquidity position could lead to additional equity financing that dilutes shareholders
Neogen is trading at $5.44 per share, or 11x forward P/E. Read our free research report to see why you should think twice about including NEOG in your portfolio.
One Stock to Watch:
Roblox (RBLX)
Rolling One-Year Beta: 1.30
Best known for its wide assortment of user-generated content, Roblox (NYSE: RBLX) is an online gaming platform and game creation system.
Why Does RBLX Catch Our Eye?
- Has the opportunity to boost monetization through new features and premium offerings as its daily active users have grown by 22.1% annually over the last two years
- Marketing spend is minimal, showing it doesn’t need advertisements to acquire new users because of its well-known brand
- Highly efficient business model is illustrated by its impressive 20.5% EBITDA margin
At $99.80 per share, Roblox trades at 59.3x forward EV/EBITDA. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking 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 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-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
