A stock with low volatility can be reassuring, but it doesn’t always mean strong long-term performance. Investors who prioritize stability may miss out on higher-reward opportunities elsewhere.
Finding the right balance between safety and returns isn’t easy, which is why StockStory is here to help. Keeping that in mind, here are three low-volatility stocks that don’t make the cut and some better opportunities instead.
Dillard's (DDS)
Rolling One-Year Beta: 0.59
With stores located largely in the Southern and Western US, Dillard’s (NYSE:DDS) is a department store chain that sells clothing, cosmetics, accessories, and home goods.
Why Does DDS Give Us Pause?
- Dearth of new stores suggests management is prioritizing the optimization of its existing locations over growth
- Disappointing same-store sales over the past two years show customers aren’t responding well to its product selection and store experience
- Performance over the past three years shows each sale was less profitable as its earnings per share dropped by 6.4% annually, worse than its revenue
Dillard’s stock price of $636.65 implies a valuation ratio of 18.3x forward P/E. Read our free research report to see why you should think twice about including DDS in your portfolio.
First American Financial (FAF)
Rolling One-Year Beta: 0.84
Tracing its roots back to 1889 when California was experiencing its first major real estate boom, First American Financial (NYSE:FAF) provides title insurance, settlement services, and risk solutions for residential and commercial real estate transactions across the United States and internationally.
Why Do We Think Twice About FAF?
- Net premiums earned contracted by 1.9% annually over the last five years, showing unfavorable market dynamics this cycle
- Flat earnings per share over the last five years lagged its peers
- Capital trends were unexciting over the last five years as its 2.8% annual book value per share growth was below the typical insurance firm
First American Financial is trading at $69.61 per share, or 1.2x forward P/B. To fully understand why you should be careful with FAF, check out our full research report (it’s free).
Assurant (AIZ)
Rolling One-Year Beta: 0.43
With roots dating back to 1892 when it was founded by a Civil War veteran, Assurant (NYSE:AIZ) provides specialized insurance products and services that protect major consumer purchases like mobile devices, vehicles, homes, and appliances.
Why Does AIZ Worry Us?
- Net premiums earned only expanded by 5.2% annually over the last five years, trailing its insurance peers as its scale limited incremental business
- Earnings per share lagged its peers over the last two years as they only grew by 15.6% annually
- Annual book value per share growth of 4.4% over the last five years lagged behind its insurance peers as its large balance sheet made it difficult to generate incremental capital growth
At $282.05 per share, Assurant trades at 2.2x forward P/B. Check out our free in-depth research report to learn more about why AIZ doesn’t pass our bar.
Stocks We Like More
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE.
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-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.