2 Volatile Stocks with Solid Fundamentals and 1 to Approach with Caution
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2 Volatile Stocks with Solid Fundamentals and 1 to Approach with Caution

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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.

These stocks can be a rollercoaster, and StockStory is here to guide you through the ups and downs. Keeping that in mind, here are two volatile stocks that could reward patient investors and one that could just as easily collapse.

One Stock to Sell:

MarineMax (HZO)

Rolling One-Year Beta: 2.15

Appropriately headquartered in Clearwater, Florida, MarineMax (NYSE:HZO) sells boats, yachts, and other marine products.

Why Are We Hesitant About HZO?

  1. Store closures and poor same-store sales reveal weak demand and a push toward operational efficiency

  2. Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new locations

  3. Short cash runway increases the probability of a capital raise that dilutes existing shareholders

At $21.91 per share, MarineMax trades at 8.4x forward P/E. Dive into our free research report to see why there are better opportunities than HZO.

Two Stocks to Watch:

Dick's (DKS)

Rolling One-Year Beta: 1.55

Started as a hunting supply store, Dick’s Sporting Goods (NYSE:DKS) is a retailer that sells merchandise for traditional sports as well as for fitness and outdoor activities.

Why Could DKS Be a Winner?

  1. Comparable store sales rose by 3.9% on average over the past two years, demonstrating its ability to drive increased spending at existing locations

  2. Share repurchases over the last five years enabled its annual earnings per share growth of 33.3% to outpace its revenue gains

  3. Industry-leading 23.2% return on capital demonstrates management’s skill in finding high-return investments

Dick's is trading at $191.10 per share, or 12.9x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.

Hubbell (HUBB)

Rolling One-Year Beta: 1.31

A respected player in the electrical segment, Hubbell (NYSE:HUBB) manufactures electronic products for the construction, industrial, utility, and telecommunications markets.

Why Are We Positive On HUBB?

  1. Operating margin expanded by 6.2 percentage points over the last five years as it scaled and became more efficient

  2. Incremental sales over the last two years have been highly profitable as its earnings per share increased by 16.6% annually, topping its revenue gains

  3. ROIC punches in at 25.5%, illustrating management’s expertise in identifying profitable investments, and its rising returns show it’s making even more lucrative bets