Market swings can be tough to stomach, and volatile stocks often experience exaggerated moves in both directions. While many thrive during risk-on environments, many also struggle to maintain investor confidence when the ride gets bumpy.
At StockStory, our job is to help you avoid costly mistakes and stay on the right side of the trade. That said, here is one volatile stock with massive upside potential and two that might not be worth the risk.
Two Stocks to Sell:
Manitowoc (MTW)
Rolling One-Year Beta: 1.91
Contracted by the United States Navy during WWII, Manitowoc (NYSE:MTW) provides cranes and lifting equipment.
Why Do We Think MTW Will Underperform?
- Product roadmap and go-to-market strategy need to be reconsidered as its backlog has averaged 15.3% declines over the past two years
- Earnings per share fell by 17.6% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- Free cash flow margin dropped by 6.7 percentage points over the last five years, implying the company became more capital intensive as competition picked up
Manitowoc is trading at $10.73 per share, or 0.2x trailing 12-month price-to-sales. Check out our free in-depth research report to learn more about why MTW doesn’t pass our bar.
CTS (CTS)
Rolling One-Year Beta: 1.49
With roots dating back to 1896 and a global manufacturing footprint, CTS (NYSE:CTS) designs and manufactures sensors, connectivity components, and actuators for aerospace, defense, industrial, medical, and transportation markets.
Why Does CTS Fall Short?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 5.7% annually over the last two years
- Smaller revenue base of $520.9 million means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
- Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term
CTS’s stock price of $38.24 implies a valuation ratio of 16x forward P/E. Read our free research report to see why you should think twice about including CTS in your portfolio.
One Stock to Watch:
PayPal (PYPL)
Rolling One-Year Beta: 1.37
Originally spun off from eBay in 2015 after being acquired by the auction giant in 2002, PayPal (NASDAQ:PYPL) operates a global digital payments platform that enables consumers and merchants to send, receive, and process payments online and in person.
Why Are We Fans of PYPL?
- Decent 10.9% annual revenue growth over the last five years beat most of its peers, showing customers find value in its products and services
- Share buybacks lifted its annual earnings per share growth to 12.6%, which outperformed its revenue gains over the last two years
- ROE punches in at 20%, illustrating management’s expertise in identifying profitable investments
At $69.20 per share, PayPal trades at 12.8x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
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Take advantage of the rebound 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).
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