The S&P 500 (^GSPC) is often seen as a benchmark for strong businesses, but that doesn’t mean every stock is worth owning. Some companies face significant challenges, whether it’s stagnating growth, heavy debt, or disruptive new competitors.
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 leading the market forward and two that could be in trouble.
Two Stocks to Sell:
Regeneron (REGN)
Market Cap: $79.7 billion
Founded by scientists who wanted to build a company where science could thrive, Regeneron Pharmaceuticals (NASDAQ: REGN) develops and commercializes medicines for serious diseases, with key products treating eye conditions, allergic diseases, cancer, and other disorders.
Why Does REGN Fall Short?
- Scale is a double-edged sword because it limits the company’s growth potential compared to its smaller competitors, as reflected in its below-average annual revenue increases of 4.6% for the last five years
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 31.1 percentage points
- Eroding returns on capital suggest its historical profit centers are aging
Regeneron is trading at $799.18 per share, or 12.9x forward P/E. To fully understand why you should be careful with REGN, check out our full research report (it’s free).
Mettler-Toledo (MTD)
Market Cap: $28.66 billion
With roots dating back to the precision balance innovations of Swiss engineer Erhard Mettler, Mettler-Toledo (NYSE: MTD) manufactures precision weighing instruments, analytical equipment, and product inspection systems used in laboratories, industrial settings, and food retail.
Why Are We Cautious About MTD?
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Estimated sales growth of 4.8% for the next 12 months is soft and implies weaker demand
- Waning returns on capital imply its previous profit engines are losing steam
Mettler-Toledo’s stock price of $1,430 implies a valuation ratio of 28.1x forward P/E. If you’re considering MTD for your portfolio, see our FREE research report to learn more.
One Stock to Buy:
ADP (ADP)
Market Cap: $107.2 billion
Processing one out of every six paychecks in the United States, ADP (NASDAQ: ADP) provides cloud-based human capital management solutions that help businesses manage payroll, benefits, talent acquisition, and HR administration.
Why Will ADP Outperform?
- Solid 7.9% annual revenue growth over the last five years indicates its offerings solve complex business issues
- Enormous revenue base of $21.95 billion provides significant distribution advantages
- ADP is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its rising cash conversion increases its margin of safety
At $270.03 per share, ADP trades at 22.1x forward P/E. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
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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-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.
