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3 Large-Cap Stocks We’re Skeptical Of

SBUX Cover Image

Large-cap stocks usually command their industries because they have the scale to drive market trends. The flip side though is that their sheer size can limit growth as expanding further becomes an increasingly challenging task.

This dynamic can trouble even the most skilled investors, but luckily for you, we started StockStory to help you navigate these trade-offs and uncover exceptional companies that break the mold. Keeping that in mind, here are three large-cap stocks whose existing offerings may be tapped out and some other investments you should look into instead.

Starbucks (SBUX)

Market Cap: $111.1 billion

Started by three friends in Seattle’s historic Pike Place Market, Starbucks (NASDAQ: SBUX) is a globally-renowned coffeehouse chain that offers a wide selection of high-quality coffee, beverages, and food items.

Why Should You Sell SBUX?

  1. Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new restaurants
  2. Day-to-day expenses have swelled relative to revenue over the last year as its operating margin fell by 6.8 percentage points
  3. Performance over the past six years shows its incremental sales were much less profitable, as its earnings per share fell by 5.9% annually

At $97.48 per share, Starbucks trades at 38.5x forward P/E. Dive into our free research report to see why there are better opportunities than SBUX.

Rocket Lab (RKLB)

Market Cap: $37.85 billion

Becoming the first private company in the Southern Hemisphere to reach space, Rocket Lab (NASDAQ: RKLB) offers rockets designed for launching small satellites.

Why Are We Hesitant About RKLB?

  1. Persistent operating margin losses suggest the business manages its expenses poorly
  2. Earnings per share have contracted by 33.4% annually over the last three years, a headwind for returns as stock prices often echo long-term EPS performance
  3. Cash-burning history makes us doubt the long-term viability of its business model

Rocket Lab’s stock price of $70.93 implies a valuation ratio of 49.6x forward price-to-sales. To fully understand why you should be careful with RKLB, check out our full research report (it’s free).

EchoStar (SATS)

Market Cap: $31.77 billion

Following its 2023 acquisition of DISH Network, EchoStar (NASDAQ: SATS) provides satellite communications, pay-TV services, wireless networks, and broadband solutions across consumer and enterprise markets.

Why Is SATS Risky?

  1. Customers postponed purchases of its products and services this cycle as its revenue declined by 6.6% annually over the last two years
  2. Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value
  3. EBITDA losses may force it to accept punitive lending terms or high-cost debt

EchoStar is trading at $110.40 per share, or 32.3x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including SATS in your portfolio.

Stocks We Like 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 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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.

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