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 could deliver good returns and two that could be in trouble.
Two Stocks to Sell:
West Pharmaceutical Services (WST)
Market Cap: $17.65 billion
Founded in 1923 and serving as a critical link in the pharmaceutical supply chain, West Pharmaceutical Services (NYSE: WST) manufactures specialized packaging, containment systems, and delivery devices for injectable drugs and healthcare products.
Why Are We Wary of WST?
- 1.6% annual revenue growth over the last two years was slower than its healthcare peers
- Efficiency has decreased over the last five years as its adjusted operating margin fell by 3.9 percentage points
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
At $245.45 per share, West Pharmaceutical Services trades at 36.6x forward P/E. Check out our free in-depth research report to learn more about why WST doesn’t pass our bar.
Fiserv (FI)
Market Cap: $74.83 billion
Powering over 1 billion accounts and processing more than 12,000 financial transactions per second globally, Fiserv (NYSE: FI) provides payment processing and financial technology solutions that enable merchants, banks, and credit unions to accept payments and manage financial transactions.
Why Are We Cautious About FI?
- Sizable revenue base leads to growth challenges as its 6.2% annual revenue increases over the last two years fell short of other financials companies
- Low return on equity reflects management’s struggle to allocate funds effectively
Fiserv is trading at $138 per share, or 12.5x forward P/E. Read our free research report to see why you should think twice about including FI in your portfolio.
One Stock to Watch:
PayPal (PYPL)
Market Cap: $66.93 billion
Originally spun off from eBay in 2015 after being acquired by the auction giant in 2002, PayPal (NASDAQ: PYPL) operates a global digital payments platform that enables consumers and merchants to send, receive, and process payments online and in person.
Why Does PYPL Stand Out?
- Annual revenue growth of 10.9% over the last five years was above the sector average and underscores its products and services value to customers
- Share buybacks lifted its annual earnings per share growth to 12.6%, which outperformed its revenue gains over the last two years
- ROE punches in at 20%, illustrating management’s expertise in identifying profitable investments
PayPal’s stock price of $70.10 implies a valuation ratio of 13.4x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at Top 5 Growth Stocks for this month. 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
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