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 is one volatile stock with massive upside potential and two that might not be worth the risk.
Two Stocks to Sell:
Twilio (TWLO)
Rolling One-Year Beta: 1.28
Known for the clever "Twilio Magic" demo that had developers creating functioning communications apps in minutes, Twilio (NYSE:TWLO) provides a platform that enables businesses to communicate with their customers through voice, messaging, email, and other digital channels.
Why Does TWLO Give Us Pause?
- Annual revenue growth of 14.7% over the last two years was below our standards for the software sector
- Sky-high servicing costs result in an inferior gross margin of 48.6% that must be offset through increased usage
- Operating margin expanded by 3.7 percentage points over the last year as it scaled and became more efficient
Twilio’s stock price of $295.25 implies a valuation ratio of 7.3x forward price-to-sales. Dive into our free research report to see why there are better opportunities than TWLO.
Walker & Dunlop (WD)
Rolling One-Year Beta: 1.13
Originating as a small mortgage banking firm during the Great Depression in 1937, Walker & Dunlop (NYSE:WD) provides commercial real estate financing, property sales, appraisal, and investment management services with a focus on multifamily properties.
Why Are We Out on WD?
- Annual net interest income declines of 41.6% for the past five years show its loan book struggled during this cycle
- Earnings per share fell by 13.7% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- Tangible book value per share tumbled by 8.5% annually over the last five years, showing banking sector trends are working against it during this cycle
At $37.27 per share, Walker & Dunlop trades at 0.7x forward P/B. Check out our free in-depth research report to learn more about why WD doesn’t pass our bar.
One Stock to Buy:
Happen Bank (HAPN)
Rolling One-Year Beta: 1.79
Pioneering peer-to-peer lending in the US before evolving into a digital bank, Happen Bank (NASDAQ:HAPN) operates a marketplace that connects borrowers with lenders, offering personal loans, auto refinancing, and banking services.
Why Will HAPN Beat the Market?
- Market share has increased this cycle as its 18.1% annual revenue growth over the last five years was exceptional
- Incremental sales over the last two years have been highly profitable as its earnings per share increased by 108% annually, topping its revenue gains
- Adequate return on equity shows management makes decent investment decisions
Happen Bank is trading at $15.62 per share, or 7.7x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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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-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.