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. Keeping that in mind, here are two volatile stocks that could deliver huge gains and one that might not be worth the risk.
One Stock to Sell:
WESCO (WCC)
Rolling One-Year Beta: 1.53
Based in Pittsburgh, WESCO (NYSE:WCC) provides electrical, industrial, and communications products and augments them with services such as supply chain management.
Why Are We Hesitant About WCC?
- Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
- Earnings per share have contracted by 12.4% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance
- Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital
WESCO’s stock price of $225.54 implies a valuation ratio of 15x forward P/E. To fully understand why you should be careful with WCC, check out our full research report (it’s free for active Edge members).
Two Stocks to Watch:
Energy Recovery (ERII)
Rolling One-Year Beta: 1.38
Having saved far more than a trillion gallons of water, Energy Recovery (NASDAQ:ERII) provides energy recovery devices to the water treatment, oil and gas, and chemical processing sectors.
Why Does ERII Stand Out?
- Impressive 15.2% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Offerings are mission-critical for businesses and lead to a best-in-class gross margin of 68%
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 82% exceeded its revenue gains over the last two years
At $17.91 per share, Energy Recovery trades at 23.5x 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.
OSI Systems (OSIS)
Rolling One-Year Beta: 1.57
With security scanners deployed at airports and borders worldwide and patient monitors used in hospitals across the globe, OSI Systems (NASDAQ:OSIS) designs and manufactures specialized electronic systems for security screening, patient monitoring, and optoelectronic applications.
Why Could OSIS Be a Winner?
- Annual revenue growth of 15.8% over the last two years was superb and indicates its market share increased during this cycle
- Adjusted operating profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
- Earnings per share grew by 22.7% annually over the last two years and trumped its peers
OSI Systems is trading at $251.11 per share, or 24.5x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free for active Edge members.
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 5 Growth Stocks for this month. 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-micro-cap company Kadant (+351% 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
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