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 three S&P 500 stocks that don’t make the cut and some better choices instead.
Comcast (CMCSA)
Market Cap: $87.15 billion
Formerly known as American Cable Systems, Comcast (NASDAQ: CMCSA) is a multinational telecommunications company offering a wide range of services.
Why Do We Steer Clear of CMCSA?
- Performance surrounding its domestic broadband customers has lagged its peers
- Projected 4.5 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
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
At $24.48 per share, Comcast trades at 6.8x forward P/E. Check out our free in-depth research report to learn more about why CMCSA doesn’t pass our bar.
Deere (DE)
Market Cap: $163.3 billion
Revolutionizing agriculture with the first self-polishing cast-steel plow in the 1800s, Deere (NYSE: DE) manufactures and distributes advanced agricultural, construction, forestry, and turf care equipment.
Why Are We Out on DE?
- Annual sales declines of 10.1% for the past two years show its products and services struggled to connect with the market during this cycle
- Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
Deere’s stock price of $607.65 implies a valuation ratio of 29.8x forward P/E. If you’re considering DE for your portfolio, see our FREE research report to learn more.
Globe Life (GL)
Market Cap: $14.29 billion
With roots dating back to 1900 and a rebranding from Torchmark Corporation in 2019, Globe Life (NYSE: GL) is an insurance holding company that offers life insurance, supplemental health insurance, and annuity products through various distribution channels.
Why Does GL Give Us Pause?
- Sales trends were unexciting over the last two years as its 4.5% annual growth was below the typical insurance company
- Growth in insurance policies was lackluster over the last five years as its 5% annual growth underperformed the typical financial institution
- Book value per share tumbled by 1.5% annually over the last five years, showing insurance sector trends are working against it during this cycle
Globe Life is trading at $184.14 per share, or 2.2x forward P/B. To fully understand why you should be careful with GL, check out our full research report (it’s free).
Stocks We Like More
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.
But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating 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 Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.
