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.
Even among blue-chip stocks, not all investments are created equal - which is why we built StockStory to help you navigate the market. Keeping that in mind, here is one S&P 500 stock that is positioned to outperform and two that may struggle.
Two Stocks to Sell:
Delta (DAL)
Market Cap: $53.47 billion
One of the ‘Big Four’ airlines in the US, Delta Air Lines (NYSE: DAL) is a major global air carrier that serves both business and leisure travelers through its domestic and international flights.
Why Do We Avoid DAL?
- Demand for its offerings was relatively low as its number of revenue passenger miles has underwhelmed
- Projected 1.7 percentage point decline in its free cash flow margin next year reflects the company’s plans to increase its investments to defend its market position
- Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value
Delta is trading at $84.12 per share, or 14.8x forward P/E. Read our free research report to see why you should think twice about including DAL in your portfolio.
Bristol-Myers Squibb (BMY)
Market Cap: $116.2 billion
With roots dating back to 1887 and a transformative merger in 1989 that gave the company its current name, Bristol-Myers Squibb (NYSE: BMY) discovers, develops, and markets prescription medications for serious diseases including cancer, blood disorders, immunological conditions, and cardiovascular diseases.
Why Does BMY Worry Us?
- Annual sales growth of 2.6% over the last five years lagged behind its healthcare peers as its large revenue base made it difficult to generate incremental demand
- Projected sales decline of 5.5% for the next 12 months points to a tough demand environment ahead
- Expenses have increased as a percentage of revenue over the last five years as its adjusted operating margin fell by 10.4 percentage points
At $54.05 per share, Bristol-Myers Squibb trades at 8.8x forward P/E. If you’re considering BMY for your portfolio, see our FREE research report to learn more.
One Stock to Watch:
Occidental Petroleum (OXY)
Market Cap: $55.17 billion
Backed by Warren Buffett's Berkshire Hathaway as a major shareholder, Occidental Petroleum (NYSE: OXY) explores for, develops, and produces oil, natural gas liquids, and natural gas, primarily in the United States and Middle East.
Why Are We Positive on OXY?
- Market share has increased this cycle as its 6.1% annual revenue growth over the last ten years was exceptional
- Massive revenue base of $21.45 billion makes it a household name that influences purchasing decisions
- OXY is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
Occidental Petroleum’s stock price of $51.83 implies a valuation ratio of 8.8x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.
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.
