The S&P 500 (^GSPC) is home to the biggest and most well-known companies in the market, making it a go-to index for investors seeking stability. But not all large-cap stocks are created equal - some are struggling with slowing growth, declining margins, or increased competition.
Some large-cap stocks are past their peak, and StockStory is here to help you separate the winners from the laggards. That said, here are two S&P 500 stocks that could deliver good returns and one that may struggle.
One Stock to Sell:
IQVIA (IQV)
Market Cap: $37.57 billion
Created from the 2016 merger of Quintiles (a clinical research organization) and IMS Health (a healthcare data specialist), IQVIA (NYSE: IQV) provides clinical research services, data analytics, and technology solutions to help pharmaceutical companies develop and market medications more effectively.
Why Are We Wary of IQV?
- Sizable revenue base leads to growth challenges as its 3.5% annual revenue increases over the last two years fell short of other healthcare companies
- Constant currency revenue growth has disappointed over the past two years and shows demand was soft
- Free cash flow margin shrank by 3.6 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
IQVIA is trading at $220.59 per share, or 17.7x forward P/E. If you’re considering IQV for your portfolio, see our FREE research report to learn more.
Two Stocks to Watch:
Lululemon (LULU)
Market Cap: $20.24 billion
Originally serving yogis and hockey players, Lululemon (NASDAQ: LULU) is a designer, distributor, and retailer of athletic apparel for men and women.
Why Are We Bullish on LULU?
- Same-store sales growth averaged 5.3% over the past two years, showing it’s bringing new and repeat shoppers into its stores
- Differentiated product assortment leads to a best-in-class gross margin of 58.8%
- Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends
At $170.80 per share, Lululemon trades at 13.9x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.
Wabtec (WAB)
Market Cap: $34.86 billion
Also known as Wabtec, Westinghouse Air Brake Technologies (NYSE: WAB) provides equipment, systems, and related software for the railway industry.
Why Are We Positive On WAB?
- Operating profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 22.6% exceeded its revenue gains over the last two years
- Robust free cash flow margin of 11.6% gives it many options for capital deployment
Wabtec’s stock price of $204.05 implies a valuation ratio of 20.9x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in our Top 6 Stocks for this week. 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-small-cap company Comfort Systems (+782% 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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