Low-volatility stocks may offer stability, but that often comes at the cost of slower growth and the upside potential of more dynamic companies.
Finding the right balance between safety and returns isn’t easy, which is why StockStory is here to help. Keeping that in mind, here are two low-volatility stocks providing safe-and-steady growth and one stuck in limbo.
One Stock to Sell:
PennyMac Mortgage Investment Trust (PMT)
Rolling One-Year Beta: 0.35
Operating as a real estate investment trust since 2009 to maintain tax advantages, PennyMac Mortgage Investment Trust (NYSE: PMT) is a specialty finance company that invests in mortgage-related assets and operates a correspondent lending business.
Why Does PMT Worry Us?
- Sales tumbled by 21.6% annually over the last five years, showing market trends are working against its favor during this cycle
- Net interest income is projected to tank by 116% over the next 12 months as demand evaporates
- Loan losses and capital returns have eroded its tangible book value per share this cycle as its tangible book value per share declined by 5.2% annually over the last five years
At $12.35 per share, PennyMac Mortgage Investment Trust trades at 0.8x forward P/B. If you’re considering PMT for your portfolio, see our FREE research report to learn more.
Two Stocks to Watch:
Lennox (LII)
Rolling One-Year Beta: 0.86
Based in Texas and founded over a century ago, Lennox (NYSE: LII) is a climate control solutions company offering heating, ventilation, air conditioning, and refrigeration (HVACR) goods.
Why Are We Positive On LII?
- Disciplined cost controls and effective management resulted in a strong long-term operating margin of 17.1%, and it turbocharged its profits by achieving some fixed cost leverage
- Performance over the past two years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
- Stellar returns on capital showcase management’s ability to surface highly profitable business ventures
Lennox’s stock price of $476.69 implies a valuation ratio of 19.6x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.
CoStar (CSGP)
Rolling One-Year Beta: 0.84
With a research department that makes over 10,000 property updates daily to its 35-year-old database, CoStar Group (NASDAQ: CSGP) provides comprehensive real estate data, analytics, and online marketplaces for commercial and residential properties in the U.S. and U.K.
Why Is CSGP Interesting?
- Market share has increased this cycle as its 14% annual revenue growth over the last five years was exceptional
- Economies of scale give it more fixed cost leverage than its smaller competitors
- Demand for the next 12 months is expected to accelerate above its two-year trend as Wall Street forecasts robust revenue growth of 21.3%
CoStar is trading at $68.64 per share, or 57.2x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free for active Edge members .
High-Quality Stocks for All Market Conditions
The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 9 Market-Beating Stocks. 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 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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