While the S&P 500 (^GSPC) includes industry leaders, not every stock in the index is a winner. Some companies are past their prime, weighed down by poor execution, weak financials, or structural headwinds.
Some large-cap stocks are past their peak, and StockStory is here to help you separate the winners from the laggards. That said, here is one S&P 500 stock that is leading the market forward and two best left off your watchlist.
Two Stocks to Sell:
IDEX (IEX)
Market Cap: $16.06 billion
Founded in 1988, IDEX (NYSE: IEX) is a global manufacturer specializing in highly engineered products such as pumps, flow meters, and fluidics systems for various industries.
Why Does IEX Fall Short?
- 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
- Earnings growth over the last two years fell short of the peer group average as its EPS only increased by 1.2% annually
- Eroding returns on capital suggest its historical profit centers are aging
IDEX’s stock price of $216.81 implies a valuation ratio of 24.9x forward P/E. Read our free research report to see why you should think twice about including IEX in your portfolio.
PayPal (PYPL)
Market Cap: $40.02 billion
Originally spun off from eBay in 2015 after being acquired by the auction giant in 2002, PayPal (NASDAQ: PYPL) operates a global digital payments platform that enables consumers and merchants to send, receive, and process payments online and in person.
Why Are We Wary of PYPL?
- Large revenue base makes it harder to increase sales quickly, and its annual revenue growth of 5.3% over the last two years was below our standards for the financials sector
- Annual earnings per share growth of 2.8% underperformed its revenue over the last two years, showing its incremental sales were less profitable
PayPal is trading at $45.33 per share, or 8.5x forward P/E. Dive into our free research report to see why there are better opportunities than PYPL.
One Stock to Buy:
Brown & Brown (BRO)
Market Cap: $19.13 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 Do We Love BRO?
- Forecasted revenue growth of 11.6% for the next 12 months indicates its momentum over the last two years is sustainable
- Earnings per share grew by 18.5% annually over the last five years, massively outpacing its peers
- BRO is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
At $56.51 per share, Brown & Brown trades at 12.8x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.
Stocks We Like Even 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 (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
