If following the stock market over the past few weeks has left your stomach doing gymnastics, you're not alone. Some investors are comfortable with big market swings. Others may worry -- or worse, sell off good stocks after they've taken a hit.

Market averages are just that; some stocks will move more than the average, some less. Beta is a measure used to show a stock's historical volatility compared to an index such as the S&P 500. A beta greater than 1 means the stock has moved more than the index. Less than 1 means the ups and downs have been a little smoother.

Beta alone doesn't help much – looking for beta less than 1 still leaves more than 2,000 stocks to pick from, and doesn't tell us much about those stocks. Fortunately, our CAPS Screener offers a broad choice of screening parameters.

I used the following settings to seek stocks that might help smooth out Mr. Market's wild ride, yet still be decent investments:

  • Beta less than 0.75
  • LT debt-to-equity ratio less than 0.8
  • Current dividend yield of 2.25 – 6%
  • Market capitalization greater than $1 billion
  • Last 3 years' EPS growth rate greater than zero
  • Price-to-earnings positive and less than 20
  • At least 15% above 52-week low
  • CAPS rating of four or five stars

The screen returned 15 stocks. As you might expect, consumer-goods companies made up the lion's share of the results, with six hits. Services, health care, utilities, and even tech and industrial goods rounded out the sector mix.

Inquiring minds might want to know how these stocks did during the big pullback two weeks ago. As it turns out, 14 of the 15 stocks lost money from the April 30 close through the May 7 close. But, only two, Sysco (NYSE: SYY) and Owens & Minor (NYSE: OMI), dropped by more than the S&P 500's 6.4% fall. One stock, Kraft (NYSE: KFT), went against the current and made actually made money for shareholders.

The table below shows the U.S.-based CAPS five-star stocks from the screen, along with their three-year beta, closing prices covering last week, and the percentage change over last week.

Company Name


30 Apr Close

7 May Close


Flowers Foods (NYSE: FLO)





Johnson & Johnson (NYSE: JNJ)





McCormick (NYSE: MKC)





Procter & Gamble (NYSE: PG)










S&P 500





*Sources: Motley Fool Stock Screener. Closing prices from Yahoo! Finance. Percentage change author's calculation.

There's nothing magic about the parameters or limits used for this screen, but it does show promise in identifying stocks that can smooth the ride a bit. Even low-volatility stocks still have risks; the bluest of the blue chips, Procter & Gamble, captured a piece of the spotlight in the recent Thursday meltdown. Also, keep in mind that low volatility probably means relatively poorer performance when the market roars upward.

If the market's big swings get a little nauseating, adding some low-beta shock absorbers to a portfolio can help smooth out the potholes and speed bumps.

Related Foolishness:

Fool contributor Russ Krull owns shares of Sysco and Johnson & Johnson, but holds no financial position in any other stock mentioned in this article. Sysco is a Motley Fool Inside Value choice. Flowers Foods, Johnson & Johnson, McCormick, Procter & Gamble, and Sysco are Motley Fool Income Investor picks. Motley Fool Options has recommended buying calls on Johnson & Johnson. The Fool owns shares of Procter & Gamble and Sysco. Whatever the market does, the Fool's disclosure policy works.