"Too big to fail" is how we would describe the megacap stocks in this article today. While they will likely stand the test of time, it’s not all sunshine and rainbows as their scale can limit their ability to find new sources of growth.

These trade-offs can cause headaches for even the most seasoned professionals, which is why we started StockStory - to help you find high-quality companies that can grow their earnings no matter what. Keeping that in mind, here is one industry titan with attractive long-term potential and two that could be stalling.

Two Mega-Cap Stocks to Sell:

Applied Materials (AMAT)

Market Cap: $241.7 billion

Founded in 1967 as the first company to develop tools for other businesses in the semiconductor industry, Applied Materials (NASDAQ: AMAT) is the largest provider of semiconductor wafer fabrication equipment.

Why Does AMAT Worry Us?

1. Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 2.1%

Applied Materials’s stock price of $305.02 implies a valuation ratio of 32.1x forward P/E. To fully understand why you should be careful with AMAT, check out our full research report (it’s free).

Walmart (WMT)

Market Cap: $959.3 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 Does WMT Fall Short?

1. Annual sales growth of 5.4% over the last three years lagged behind its consumer retail peers as its large revenue base made it difficult to generate incremental demand
2. Gross margin of 24.8% is below its competitors, leaving less money for marketing and promotions
3. Poor expense management has led to an operating margin of 4.2% that is below the industry average

Walmart is trading at $120.30 per share, or 41.3x forward P/E. If you’re considering WMT for your portfolio, see our FREE research report to learn more.

One Mega-Cap Stock to Buy:

GE Aerospace (GE)

Market Cap: $345.2 billion

One of the original 12 companies on the Dow Jones Industrial Average, General Electric (NYSE: GE) is a multinational conglomerate providing technologies for various sectors including aviation, power, renewable energy, and healthcare.

Why Is GE a Good Business?

1. Annual revenue growth of 14.5% over the past two years was outstanding, reflecting market share gains this cycle
2. Share repurchases over the last two years enabled its annual earnings per share growth of 43.6% to outpace its revenue gains
3. Robust free cash flow margin of 17.6% gives it many options for capital deployment

At $327.27 per share, GE Aerospace trades at 47.7x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

Stocks We Like Even More

Check out the high-quality names we’ve flagged in 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 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 Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.