
1 Safe-and-Steady Stock to Own for Decades and 2 to Steer Clear Of
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 is one low-volatility stock providing safe-and-steady growth and two that may not keep up.
Two Stocks to Sell:
Wendy's (WEN)
Rolling One-Year Beta: 0.22
Founded by Dave Thomas in 1969, Wendy’s (NASDAQ:WEN) is a renowned fast-food chain known for its fresh, never-frozen beef burgers, flavorful menu options, and commitment to quality.
Why Is WEN Not Exciting?
-
5.6% annual revenue growth over the last five years was slower than its restaurant peers
-
Demand is forecasted to shrink as its estimated sales for the next 12 months are flat
-
High net-debt-to-EBITDA ratio of 7× increases the risk of forced asset sales or dilutive financing if operational performance weakens
At $12.70 per share, Wendy's trades at 12.3x forward price-to-earnings. To fully understand why you should be careful with WEN, check out our full research report (it’s free) .
Wiley (WLY)
Rolling One-Year Beta: 0.74
With roots dating back to 1807 when Charles Wiley opened a small printing shop in Manhattan, John Wiley & Sons (NYSE:WLY) is a global academic publisher that provides scientific journals, books, digital courseware, and knowledge solutions for researchers, students, and professionals.
Why Should You Sell WLY?
-
Annual sales declines of 1.6% for the past five years show its products and services struggled to connect with the market during this cycle
-
Flat earnings per share over the last two years underperformed the sector average
-
Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 4.3 percentage points
Wiley is trading at $41.65 per share, or 17.4x forward EV-to-EBITDA. Check out our free in-depth research report to learn more about why WLY doesn’t pass our bar .
One Stock to Buy:
BellRing Brands (BRBR)
Rolling One-Year Beta: 0.86
Spun out of Post Holdings in 2019, Bellring Brands (NYSE:BRBR) offers protein shakes, nutrition bars, and other products under the PowerBar, Premier Protein, and Dymatize brands.
Why Will BRBR Beat the Market?
-
Products are selling at a rapid clip as its unit sales averaged an outstanding 21.2% growth rate over the past two years
-
Earnings per share grew by 30.9% annually over the last three years, massively outpacing its peers
-
Stellar returns on capital showcase management’s ability to surface highly profitable business ventures