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.
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 are two S&P 500 stocks that could deliver good returns and one best left off your watchlist.
One Stock to Sell:
Walmart (WMT)
Market Cap: $902.1 billion
Known for its large-format Supercenters, Walmart (NYSE: WMT) is a retail pioneer that serves a budget-conscious consumer who is looking for a wide range of products under one roof.
Why Is WMT Not Exciting?
- Sizable revenue base leads to growth challenges as its 5.4% annual revenue increases over the last three years fell short of other consumer retail companies
- Gross margin of 24.8% is an output of its commoditized inventory
- Operating margin of 4.2% falls short of the industry average, and the smaller profit dollars make it harder to react to unexpected market developments
At $113.33 per share, Walmart trades at 40.3x forward P/E. Check out our free in-depth research report to learn more about why WMT doesn’t pass our bar.
Two Stocks to Watch:
Howmet (HWM)
Market Cap: $77.35 billion
Inventing the first forged aluminum truck wheel, Howmet (NYSE: HWM) specializes in lightweight metals engineering and manufacturing multi-material components used in vehicles.
Why Is HWM a Top Pick?
- Annual revenue growth of 11.4% over the last two years was superb and indicates its market share increased during this cycle
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 42.7% exceeded its revenue gains over the last two years
- Free cash flow margin grew by 13.8 percentage points over the last five years, giving the company more chips to play with
Howmet is trading at $192.50 per share, or 45.8x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.
Elevance Health (ELV)
Market Cap: $75.79 billion
Formerly known as Anthem until its 2022 rebranding, Elevance Health (NYSE: ELV) is one of America's largest health insurers, serving approximately 47 million medical members through its network-based managed care plans.
Why Do We Like ELV?
- 10.7% annual revenue growth over the last five years was better than the sector average, highlighting the value of its products and services
- Dominant market position is represented by its $193.3 billion in revenue, which gives it negotiating power over membership pricing and reimbursement rates
- Industry-leading 27.7% return on capital demonstrates management’s skill in finding high-return investments
Elevance Health’s stock price of $336.77 implies a valuation ratio of 12x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free for active Edge members .
Stocks We Like Even More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check 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 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 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
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