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. Keeping that in mind, here is one S&P 500 stock that is leading the market forward and two best left off your watchlist.
Two Stocks to Sell:
Texas Instruments (TXN)
Market Cap: $231.8 billion
Headquartered in Dallas, Texas since the 1950s, Texas Instruments (NASDAQ: TXN) is the world’s largest producer of analog semiconductors.
Why Are We Wary of TXN?
- Annual sales growth of 3% over the last five years lagged behind its semiconductor peers as its large revenue base made it difficult to generate incremental demand
- Expenses have increased as a percentage of revenue over the last five years as its operating margin fell by 14.2 percentage points
- Earnings per share have contracted by 1.7% annually over the last five years, a headwind for returns as stock prices often echo long-term EPS performance
Texas Instruments’s stock price of $253.50 implies a valuation ratio of 26.3x forward P/E. Check out our free in-depth research report to learn more about why TXN doesn’t pass our bar.
Old Dominion Freight Line (ODFL)
Market Cap: $38.52 billion
With its name deriving from the Commonwealth of Virginia’s nickname, Old Dominion (NASDAQ: ODFL) delivers less-than-truckload (LTL) and full-container load freight.
Why Do We Think Twice About ODFL?
- Declining unit sales over the past two years show it’s struggled to increase its sales volumes and had to rely on price increases
- Earnings per share have dipped by 5.7% annually over the past two years, which is concerning because stock prices follow EPS over the long term
- Eroding returns on capital suggest its historical profit centers are aging
Old Dominion Freight Line is trading at $184.64 per share, or 30.1x forward P/E. Dive into our free research report to see why there are better opportunities than ODFL.
One Stock to Watch:
AMETEK (AME)
Market Cap: $53.69 billion
Started from its humble beginnings in motor repair, AMETEK (NYSE: AME) manufactures electronic devices used in industries like aerospace, power, and healthcare.
Why Are We Fans of AME?
- Annual revenue growth of 9.8% over the last five years beat the sector average and underscores the unique value of its offerings
- Disciplined cost controls and effective management resulted in a strong long-term operating margin of 25.4%, and its operating leverage amplified its profits over the last five years
- AME is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its rising cash conversion increases its margin of safety
At $233.90 per share, AMETEK trades at 26.3x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE.
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-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.
