A highly volatile stock can deliver big gains - or just as easily wipe out a portfolio if things go south. While some investors embrace risk, mistakes can be costly for those who aren’t prepared.
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 that could reward patient investors and two that might not be worth the risk.
Two Stocks to Sell:
Travel + Leisure (TNL)
Rolling One-Year Beta: 1.29
Formerly known as Wyndham Destinations, Travel + Leisure (NYSE: TNL) is a global vacation company that provides travelers with vacation ownership, exchange, and travel services.
Why Does TNL Fall Short?
- Number of tours conducted has disappointed over the past two years, indicating weak demand for its offerings
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
- High net-debt-to-EBITDA ratio of 8× could force the company to raise capital at unfavorable terms if market conditions deteriorate
Travel + Leisure’s stock price of $62.58 implies a valuation ratio of 9.4x forward P/E. Read our free research report to see why you should think twice about including TNL in your portfolio.
LendingClub (LC)
Rolling One-Year Beta: 1.50
Pioneering peer-to-peer lending in the US before evolving into a digital bank, LendingClub (NYSE: LC) operates a marketplace that connects borrowers with lenders, offering personal loans, auto refinancing, and banking services.
Why Are We Hesitant About LC?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 8% annually over the last two years
- Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term
- Below-average return on equity indicates management struggled to find compelling investment opportunities
At $16.50 per share, LendingClub trades at 17.8x forward P/E. To fully understand why you should be careful with LC, check out our full research report (it’s free).
One Stock to Buy:
Magnite (MGNI)
Rolling One-Year Beta: 1.74
Born from the 2020 merger of Rubicon Project and Telaria, Magnite (NASDAQ: MGNI) operates the world's largest independent sell-side advertising platform that automates the buying and selling of digital advertising inventory across all channels and formats.
Why Will MGNI Beat the Market?
- Annual revenue growth of 33% over the last five years was superb and indicates its market share increased during this cycle
- Incremental sales over the last two years have been highly profitable as its earnings per share increased by 22.8% annually, topping its revenue gains
- Robust free cash flow margin of 23.3% gives it many options for capital deployment, and its improved cash conversion implies it’s becoming a less capital-intensive business
Magnite is trading at $25.75 per share, or 27.6x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 6 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
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
