While the S&P 500 (^GSPC) includes industry leaders, not every stock in the index is a winner. Some companies are past their prime, weighed down by poor execution, weak financials, or structural headwinds.
Picking the right S&P 500 stocks requires more than just buying big names, and that’s where StockStory comes in. Keeping that in mind, here is one S&P 500 stock that is positioned to outperform and two that may struggle.
Two Stocks to Sell:
Kellanova (K)
Market Cap: $28.58 billion
With Corn Flakes as its first and most iconic product, Kellanova (NYSE: K) is a packaged foods company that is dominant in the cereal and snack categories.
Why Are We Wary of K?
- Shrinking unit sales over the past two years indicate demand is soft and that the company may need to revise its product strategy
- Estimated sales growth of 1.9% for the next 12 months is soft and implies weaker demand
- Earnings per share have dipped by 3.5% annually over the past three years, which is concerning because stock prices follow EPS over the long term
At $82.39 per share, Kellanova trades at 21x forward P/E. Read our free research report to see why you should think twice about including K in your portfolio.
Teledyne (TDY)
Market Cap: $22.78 billion
Playing a role in mapping the ocean floor as we know it today, Teledyne (NYSE: TDY) offers digital imaging and instrumentation products for various industries.
Why Does TDY Give Us Pause?
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Below-average returns on capital indicate management struggled to find compelling investment opportunities, and its shrinking returns suggest its past profit sources are losing steam
Teledyne is trading at $486.22 per share, or 21.9x forward P/E. Dive into our free research report to see why there are better opportunities than TDY.
One Stock to Buy:
CrowdStrike (CRWD)
Market Cap: $113.5 billion
Founded by George Kurtz, the former CTO of the antivirus company McAfee, CrowdStrike (NASDAQ: CRWD) provides cybersecurity software that protects companies from breaches and helps them detect and respond to cyber attacks.
Why Is CRWD a Top Pick?
- Ability to secure long-term commitments with customers is evident in its 29% ARR growth over the last year
- Estimated revenue growth of 21.1% for the next 12 months implies its momentum over the last three years will continue
- Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends
CrowdStrike’s stock price of $455.59 implies a valuation ratio of 23.5x forward price-to-sales. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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.
