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. That said, here are two S&P 500 stocks that could deliver good returns and one that could be in trouble.
One Stock to Sell:
Genuine Parts (GPC)
Market Cap: $19.65 billion
Largely targeting the professional customer, Genuine Parts (NYSE:GPC) sells auto and industrial parts such as batteries, belts, bearings, and machine fluids.
Why Is GPC Not Exciting?
- Sizable revenue base leads to growth challenges as its 4.7% annual revenue increases over the last six years fell short of other consumer retail companies
- Poor same-store sales performance over the past two years indicates it’s having trouble bringing new shoppers into its brick-and-mortar locations
- Capital intensity has ramped up over the last year as its free cash flow margin decreased by 3.4 percentage points
At $141.28 per share, Genuine Parts trades at 17.4x forward P/E. Read our free research report to see why you should think twice about including GPC in your portfolio.
Two Stocks to Watch:
Monolithic Power Systems (MPWR)
Market Cap: $39.95 billion
Founded in 1997 by its longtime CEO Michael Hsing, Monolithic Power Systems (NASDAQ:MPWR) is an analog and mixed signal chipmaker that specializes in power management chips meant to minimize total energy consumption.
Why Is MPWR a Good Business?
- Market share has increased this cycle as its 17.3% annual revenue growth over the last two years was exceptional
- Robust free cash flow margin of 30.3% gives it many options for capital deployment, and its rising cash conversion increases its margin of safety
- Industry-leading 45.9% return on capital demonstrates management’s skill in finding high-return investments
Monolithic Power Systems is trading at $834.52 per share, or 46.7x forward P/E. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
Incyte (INCY)
Market Cap: $16.23 billion
Founded in 1991 and evolving from a genomics research firm to a commercial-stage drug developer, Incyte (NASDAQ:INCY) is a biopharmaceutical company that discovers, develops, and commercializes proprietary therapeutics for cancer and inflammatory diseases.
Why Are We Positive On INCY?
- Annual revenue growth of 14.2% over the last two years beat the sector average and underscores the unique value of its offerings
- Performance over the past five years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
- Free cash flow margin expanded by 6.2 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
Incyte’s stock price of $83.07 implies a valuation ratio of 13.6x 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
When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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