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. That said, here is one S&P 500 stock that is positioned to outperform and two that could be in trouble.
Two Stocks to Sell:
onsemi (ON)
Market Cap: $24.1 billion
Spun out of Motorola in 1999 and built through a series of acquisitions, onsemi (NASDAQ: ON) is a global provider of analog chips specializing in autos, industrial applications, and power management in cloud data centers.
Why Is ON Not Exciting?
- Sales tumbled by 13.9% annually over the last two years, showing market trends are working against its favor during this cycle
- Demand will likely be weak over the next 12 months as Wall Street expects flat revenue
- Competitive supply chain dynamics and steep production costs are reflected in its low gross margin of 41.2%
At $59.80 per share, onsemi trades at 23x forward P/E. Dive into our free research report to see why there are better opportunities than ON.
Genuine Parts (GPC)
Market Cap: $19.33 billion
Largely targeting the professional customer, Genuine Parts (NYSE: GPC) sells auto and industrial parts such as batteries, belts, bearings, and machine fluids.
Why Are We Cautious About GPC?
- Sizable revenue base leads to growth challenges as its 4% annual revenue increases over the last three years fell short of other consumer retail companies
- Disappointing same-store sales over the past two years show customers aren’t responding well to its product selection and store experience
- Free cash flow margin shrank by 3.3 percentage points over the last year, suggesting the company is consuming more capital to stay competitive
Genuine Parts is trading at $135.49 per share, or 16.8x forward P/E. Check out our free in-depth research report to learn more about why GPC doesn’t pass our bar.
One Stock to Buy:
Comfort Systems (FIX)
Market Cap: $40.19 billion
Formed through the merger of 12 companies, Comfort Systems (NYSE: FIX) provides mechanical and electrical contracting services.
Why Will FIX Outperform?
- Average backlog growth of 33.6% over the past two years shows it has a steady sales pipeline that will drive future orders
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 74.2% exceeded its revenue gains over the last two years
- Improving returns on capital reflect management’s ability to monetize investments
Comfort Systems’s stock price of $1,150 implies a valuation ratio of 39.6x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Check out the high-quality names we’ve flagged in 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-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
