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.
Navigating these stocks isn’t easy, which is why StockStory helps you find Comfort In Chaos. Keeping that in mind, here are three volatile stocks to avoid and some better opportunities instead.
Designer Brands (DBI)
Rolling One-Year Beta: 2.23
Founded in 1969 as a shoe importer and distributor, Designer Brands (NYSE: DBI) is an American discount retailer focused on footwear and accessories.
Why Do We Avoid DBI?
- Poor same-store sales performance over the past two years indicates it’s having trouble bringing new shoppers into its brick-and-mortar locations
- ROIC of 3.2% reflects management’s challenges in identifying attractive investment opportunities, and its shrinking returns suggest its past profit sources are losing steam
Designer Brands’s stock price of $3.78 implies a valuation ratio of 5.9x forward EV-to-EBITDA. If you’re considering DBI for your portfolio, see our FREE research report to learn more.
RadNet (RDNT)
Rolling One-Year Beta: 1.06
With over 350 imaging facilities across seven states and a growing artificial intelligence division, RadNet (NASDAQ: RDNT) operates a network of outpatient diagnostic imaging centers across the United States, offering services like MRI, CT scans, PET scans, mammography, and X-rays.
Why Is RDNT Not Exciting?
- Revenue base of $1.97 billion puts it at a disadvantage compared to larger competitors exhibiting economies of scale
- Expenses have increased as a percentage of revenue over the last five years as its adjusted operating margin fell by 3.5 percentage points
- Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital
RadNet is trading at $75.13 per share, or 102.2x forward P/E. Read our free research report to see why you should think twice about including RDNT in your portfolio.
DigitalBridge (DBRG)
Rolling One-Year Beta: 2.04
Transforming from a traditional real estate investor to a digital-focused powerhouse in 2021, DigitalBridge Group (NYSE: DBRG) is a global digital infrastructure investment firm that manages capital and operates assets across data centers, cell towers, fiber networks, and edge infrastructure.
Why Do We Think Twice About DBRG?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 35.2% annually over the last five years
- Low return on equity reflects management’s struggle to allocate funds effectively
- EBITDA losses may force it to accept punitive lending terms or high-cost debt
At $9.56 per share, DigitalBridge trades at 1.1x forward P/E. Dive into our free research report to see why there are better opportunities than DBRG.
High-Quality Stocks for All Market Conditions
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in 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 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.
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