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2 S&P 500 Stocks with Competitive Advantages and 1 Facing Headwinds

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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 positioned to outperform and one that could be in trouble.

One Stock to Sell:

Capital One (COF)

Market Cap: $143 billion

Starting as a credit card company in 1988 before expanding into a full-service bank, Capital One (NYSE: COF) is a financial services company that offers credit cards, auto loans, banking services, and commercial lending to consumers and businesses.

Why Are We Hesitant About COF?

  1. Large asset base makes it harder to grow tangible book value per share quickly, and its annual tangible book value per share growth of 1.3% over the last two years was below our standards for the financials sector

At $223 per share, Capital One trades at 12.8x forward P/E. Dive into our free research report to see why there are better opportunities than COF.

Two Stocks to Watch:

Booking (BKNG)

Market Cap: $176.8 billion

Formerly known as The Priceline Group, Booking Holdings (NASDAQ: BKNG) is the world’s largest online travel agency.

Why Could BKNG Be a Winner?

  1. Has the opportunity to boost monetization through new features and premium offerings as its room nights booked have grown by 9.5% annually over the last two years
  2. Share buybacks catapulted its annual earnings per share growth to 39%, which outperformed its revenue gains over the last three years
  3. Robust free cash flow margin of 35.3% gives it many options for capital deployment

Booking is trading at $5,455 per share, or 18.2x forward EV/EBITDA. Is now the right time to buy? Find out in our full research report, it’s free.

Everest Group (EG)

Market Cap: $14.49 billion

Rebranded from Everest Re in 2023 to reflect its evolution beyond just reinsurance, Everest Group (NYSE: EG) underwrites property and casualty reinsurance and insurance worldwide, serving insurance companies, corporations, and other clients across six continents.

Why Are We Positive On EG?

  1. Market share has increased this cycle as its 15.4% annual revenue growth over the last two years was exceptional
  2. Strong 14% annualized net premiums earned expansion over the last five years shows it’s capturing market share this cycle
  3. Projected book value per share growth of 16.2% for the next 12 months suggests its capital momentum from the last two years will persist

Everest Group’s stock price of $345.49 implies a valuation ratio of 0.9x forward P/B. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.

Stocks We Like Even More

Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check 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 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-micro-cap company Kadant (+351% 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

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.

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