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 are two S&P 500 stocks that could deliver good returns and one that could be in trouble.
One Stock to Sell:
T. Rowe Price (TROW)
Market Cap: $24.86 billion
Founded in 1937 by Thomas Rowe Price Jr., who pioneered the growth stock investing approach, T. Rowe Price (NASDAQ: TROW) is an investment management firm that offers mutual funds, advisory services, and retirement planning solutions to individuals and institutions.
Why Is TROW Not Exciting?
- Annual revenue growth of 2.6% over the last five years was below our standards for the financials sector
- Incremental sales over the last five years were much less profitable as its earnings per share fell by 1.4% annually while its revenue grew
T. Rowe Price’s stock price of $115.99 implies a valuation ratio of 11.3x forward P/E. Read our free research report to see why you should think twice about including TROW in your portfolio.
Two Stocks to Buy:
Microsoft (MSFT)
Market Cap: $2.9 trillion
Originally named "Micro-soft" for microcomputer software when founded in 1975, Microsoft (NASDAQ: MSFT) is a global technology company that develops software, cloud services, devices, and AI solutions for consumers, businesses, and organizations worldwide.
What Makes MSFT Stand Out?
- Microsoft is one of the great brands not just in tech but all of business. It produces mission-critical software and bundles it together, resulting in cream-of-the-crop gross margins.
- The company’s elite unit economics lead to robust profit margins that improve over time. This speaks to the scale advantages and operating efficiency across its diverse portfolio, which spans everything from Office and Azure to Minecraft.
- Microsoft has a virtuous cycle of returns. Its dominant market position enables it to generate strong free cash flow, and it reinvests these funds into promising ventures that further strengthen its competitive moat.
At $388.29 per share, Microsoft trades at 21.5x forward price-to-earnings. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.
Brown & Brown (BRO)
Market Cap: $22.16 billion
With roots dating back to 1939 and operations spanning 44 U.S. states and 14 countries, Brown & Brown (NYSE: BRO) is an insurance brokerage and risk management firm that markets and sells insurance products across property, casualty, and employee benefits sectors.
Why Is BRO a Top Pick?
- Sales outlook for the upcoming 12 months implies the business will stay on its desirable two-year growth trajectory
- Earnings growth has massively outpaced its peers over the last five years as its EPS has compounded at 18.5% annually
- Robust free cash flow margin of 23.2% gives it many options for capital deployment
Brown & Brown is trading at $65.28 per share, or 14.7x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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 (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.
