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 may struggle.
One Industrials Stock to Sell:
Huntington Ingalls (HII)
Market Cap: $12.66 billion
Building Nimitz-class aircraft carriers used in active service, Huntington Ingalls (NYSE:HII) develops marine vessels and their mission systems and maintenance services.
Why Is HII Risky?
- Sales pipeline suggests its future revenue growth may not meet our standards as its average backlog growth of 4.9% for the past two years was weak
- Earnings per share fell by 1.1% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
At $322.66 per share, Huntington Ingalls trades at 19.4x forward P/E. If you’re considering HII for your portfolio, see our FREE research report to learn more.
Two Industrials Stocks to Watch:
Parker-Hannifin (PH)
Market Cap: $109.5 billion
Founded in 1917, Parker Hannifin (NYSE:PH) is a manufacturer of motion and control systems for a wide variety of mobile, industrial and aerospace markets.
Why Is PH on Our Radar?
- Highly efficient business model is illustrated by its impressive 18.2% operating margin, and its profits increased over the last five years as it scaled
- Performance over the past five years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
- PH is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its growing cash flow gives it even more resources to deploy
Parker-Hannifin’s stock price of $867.46 implies a valuation ratio of 28x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.
GE Aerospace (GE)
Market Cap: $308.2 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 Are We Bullish on GE?
- Annual revenue growth of 15.2% over the last two years was superb and indicates its market share increased during this cycle
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 43.6% exceeded its revenue gains over the last two years
- Robust free cash flow margin of 18.6% gives it many options for capital deployment
GE Aerospace is trading at $302.36 per share, or 43x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free for active Edge members.
Stocks We Like Even 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 9 Market-Beating Stocks. 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today.