Stability is great, but low-volatility stocks may struggle to deliver market-beating returns over time as they sometimes underperform during bull markets.
Finding the right balance between safety and returns isn’t easy, which is why StockStory is here to help. That said, here are three low-volatility stocks to steer clear of and a few better alternatives.
Paylocity (PCTY)
Rolling One-Year Beta: 0.10
Operating in a field where companies traditionally juggled multiple disconnected systems, Paylocity (NASDAQ: PCTY) provides cloud-based human capital management and payroll software solutions that help businesses manage their workforce and HR processes.
Why Does PCTY Give Us Pause?
- Average ARR growth of 12.2% over the last year has disappointed, suggesting it’s had a hard time winning long-term deals and renewals
- Estimated sales growth of 6.7% for the next 12 months implies demand will slow from its two-year trend
- Operating profits increased over the last year as the company gained some leverage on its fixed costs and became more efficient
Paylocity is trading at $143.33 per share, or 4.1x forward price-to-sales. Read our free research report to see why you should think twice about including PCTY in your portfolio.
Western Union (WU)
Rolling One-Year Beta: 0.90
With a history dating back to 1851 when it began as a telegraph company, Western Union (NYSE: WU) is a global money transfer service that enables consumers and businesses to send funds across borders and currencies, typically within minutes.
Why Do We Pass on WU?
- Sales tumbled by 4.3% annually over the last five years, showing market trends are working against it during this cycle
- Falling earnings per share over the last five years has some investors worried as stock prices ultimately follow EPS over the long term
At $6.21 per share, Western Union trades at 4.2x forward P/E. To fully understand why you should be careful with WU, check out our full research report (it’s free).
Visteon (VC)
Rolling One-Year Beta: 0.85
Originally spun off from Ford Motor Company in 2000, Visteon (NYSE: VC) designs and manufactures cockpit electronics for vehicles, including digital instrument clusters, displays, infotainment systems, and battery management systems.
Why Are We Hesitant About VC?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 2.2% annually over the last two years
- High input costs result in an inferior gross margin of 12.3% that must be offset through higher volumes
- Earnings per share have contracted by 33.3% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance
Visteon’s stock price of $90.47 implies a valuation ratio of 9.3x forward P/E. Check out our free in-depth research report to learn more about why VC doesn’t pass our bar.
Stocks We Like More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.
