The U.S. stock market is expected to remain volatile due to uncertainty surrounding trade policies, economic concerns and shifts in investor sentiment. President Trump's tariffs on major trading partners, including Mexico, Canada and China, have resulted in retaliatory measures that heighten market anxiety. While hopes for tariff concessions have led to temporary rebounds, broader economic challenges persist. Moreover, key economic indicators, such as jobless claims, payroll reports and corporate earnings, could further influence market movements, contributing to ongoing volatility.
In this context, creating a curated portfolio of low-beta stocks is a prudent strategy. This provides a safeguard against heightened market fluctuations and equips investors to navigate volatility with greater resilience and foresight.
Hence, stocks like TheProgressive Corporation PGR, Pearson plc PSO, TXO Partners LP TXO and Jazz Pharmaceuticals plc JAZZ are worth betting on.
What Does Beta of a Stock Measure?
Beta measures the volatility or risk of a particular asset compared to the market. In other words, beta measures the extent of a security’s price movement relative to the market. In this article, we are considering the S&P 500 as the market.
If a stock has a beta of 1, then the price of the stock will move with the market. So, the stock is more volatile than the market if its beta is more than 1. In the same way, the stock is not as volatile as the market if its beta is less than 1.
For example, if the market offers a return of 20%, a stock with a beta of 3 will return 60%, which is overwhelming. Similarly, when the market slips 20%, the stock will sink 60%, which is devastating.
Screening Criteria Using Research Wizard:
We have taken a beta between 0 and 0.6 as our prime criterion for screening stocks that are less volatile than the market. However, this should not be the only factor to be considered while selecting a winning strategy. We need to take into account other parameters that can add value to the portfolio.
Percentage Change in Price in the Last 4 Weeks Greater Than Zero: This ensures that the stocks saw positive price movement over the last month.
Average 20-Day Volume Greater Than 50,000: A substantial trading volume ensures that the stocks are easily tradable.
Price Greater Than or Equal to $5: They must all be trading at a minimum of $5 or higher.
Zacks Rank Equal to 1: Zacks Rank #1 (Strong Buy) stocks indicate that they will significantly outperform the broader U.S. equity market over the next one to three months. You can see the complete list of today’s Zacks #1 Rank stocks here.
Here are four of the eight stocks that qualified for the screening:
The Progressive Corporation
The Progressive Corporation demonstrated exceptional growth in 2024, with net premiums written increasing 21% year over year to $74.4 billion and active policies growing by more than 5 million. The company achieved an 88.8 combined ratio, significantly outperforming its 96 target. Strong claims management, operational efficiencies and strategic technology investments have driven superior underwriting profitability. Progressive's competitive advantage in pricing, segmentation and customer service positions it well for continued growth. With stable rates, disciplined expense management and a commitment to innovation, PGR remains a strong investment in the insurance space.
Pearson
Pearson is well-positioned for growth, driven by its strong performance in assessments, enterprise learning and digital education. In 2024, sales grew 3%, with profits rising 10% and an EBIT margin of 16.9%. Strategic partnerships with AWS and Microsoft enhance Pearson’s AI capabilities and expand enterprise learning opportunities. The company’s leadership in assessments, innovative digital offerings and operational efficiencies support its long-term growth outlook. With a disciplined capital allocation strategy and continued margin expansion, Pearson remains a compelling investment in the evolving education technology and workforce skills market.
Jazz Pharmaceuticals
Jazz Pharmaceuticals delivered strong 2024 results, with annual revenues exceeding $4 billion and fourth-quarter revenues reaching a record $1.09 billion. The company’s diversified portfolio in sleep, epilepsy and oncology continues to drive growth, with Xywav, Epidiolex and Zepzelca showing strong performance. Key R&D milestones include the FDA approval of Ziihera for HER2-positive biliary tract cancer and advancements in its oncology pipeline. With robust cash flow, disciplined capital allocation and a strong pipeline, JAZZ is well-positioned for continued growth and value creation in 2025 and beyond.
TXO Partners
TXO Partners has a strong footprint in the oil-rich Permian – the most prolific basin in the United States. Being involved in exploration and production activities, the master limited partnership may continue to gain from a favorable commodity pricing environment. Notably, TXO's Mancos Shale project, with 58,500 contiguous acres holding nearly 3 Tcfe of natural gas potential, is set to be a game-changer by potentially increasing reserves fivefold, with Phase I targeting a 3,520-acre block estimated to hold 200-300 Bcf of natural gas, nearly doubling existing reserves.
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.
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Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
Disclosure: Performance information for Zacks’ portfolios and strategies are available at: https://www.zacks.com/performance.
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