Large-cap stocks have the power to shape entire industries thanks to their size and widespread influence. With such vast footprints, however, finding new areas for growth is much harder than for smaller, more agile players.
This is precisely where StockStory comes in - our job is to find you high-quality companies that can win regardless of the conditions. That said, here is one large-cap stock that still has big upside potential and two whose momentum may slow.
Two Large-Cap Stocks to Sell:
Johnson Controls (JCI)
Market Cap: $70.22 billion
Founded after patenting the electric room thermostat, Johnson Controls (NYSE: JCI) specializes in building products and technology solutions, including HVAC systems, fire and security systems, and energy storage.
Why Should You Dump JCI?
- Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
- Projected sales growth of 4.1% for the next 12 months suggests sluggish demand
- Low returns on capital reflect management’s struggle to allocate funds effectively
At $106.71 per share, Johnson Controls trades at 27.7x forward P/E. Read our free research report to see why you should think twice about including JCI in your portfolio.
CoStar (CSGP)
Market Cap: $34.65 billion
With a research department that makes over 10,000 property updates daily to its 35-year-old database, CoStar Group (NASDAQ: CSGP) provides comprehensive real estate data, analytics, and online marketplaces for commercial and residential properties in the U.S. and U.K.
Why Are We Hesitant About CSGP?
- Efficiency has decreased over the last five years as its adjusted operating margin fell by 23.7 percentage points
- Earnings per share fell by 3.1% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- 16.6 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
CoStar is trading at $81.65 per share, or 77.4x forward P/E. Check out our free in-depth research report to learn more about why CSGP doesn’t pass our bar.
One Large-Cap Stock to Buy:
DoorDash (DASH)
Market Cap: $101.2 billion
Founded by Stanford students with the intent to build “the local, on-demand FedEx", DoorDash (NYSE: DASH) operates an on-demand food delivery platform.
Why Should You Buy DASH?
- Orders have grown by 21% annually, allowing for more profitable cross-selling opportunities if it can build complementary products and features
- Additional sales over the last three years increased its profitability as the 105% annual growth in its earnings per share outpaced its revenue
- Free cash flow margin grew by 11.3 percentage points over the last few years, giving the company more chips to play with
DoorDash’s stock price of $238.51 implies a valuation ratio of 35.8x forward EV/EBITDA. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out 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 183% over the last five years (as of March 31st 2025).
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 Exlservice (+354% 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
