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.
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 is one S&P 500 stock that could deliver good returns and two best left off your watchlist.
Two Stocks to Sell:
West Pharmaceutical Services (WST)
Market Cap: $25.46 billion
Founded in 1923 and serving as a critical link in the pharmaceutical supply chain, West Pharmaceutical Services (NYSE: WST) manufactures specialized packaging, containment systems, and delivery devices for injectable drugs and healthcare products.
Why Does WST Give Us Pause?
- 5.7% annual revenue growth over the last five years was slower than its healthcare peers
- Expenses have increased as a percentage of revenue over the last five years as its adjusted operating margin fell by 5.3 percentage points
- Diminishing returns on capital suggest its earlier profit pools are drying up
West Pharmaceutical Services is trading at $361.78 per share, or 39x forward P/E. Check out our free in-depth research report to learn more about why WST doesn’t pass our bar.
Citigroup (C)
Market Cap: $226.5 billion
With operations in nearly 160 countries and a history dating back to 1812, Citigroup (NYSE: C) is a global financial services company that provides banking, investment, wealth management, and payment solutions to consumers, corporations, and governments.
Why Does C Worry Us?
- Annual net interest income growth of 8% over the last five years lagged behind its banking peers as its large revenue base made it difficult to generate incremental demand
- Inferior net interest margin of 2.5% means it must compensate for lower profitability through increased loan originations
- Performance over the past five years shows its incremental sales were less profitable as its earnings per share were flat
At $135.36 per share, Citigroup trades at 1.1x forward P/B. Dive into our free research report to see why there are better opportunities than C.
One Stock to Buy:
Intuitive Surgical (ISRG)
Market Cap: $141.9 billion
Pioneering minimally invasive surgery since its first da Vinci system was FDA-cleared in 2000, Intuitive Surgical (NASDAQ: ISRG) develops and manufactures robotic-assisted surgical systems that enable minimally invasive procedures across various medical specialties.
What Makes ISRG Stand Out?
- Market share has increased this cycle as its 20.7% annual revenue growth over the last two years was exceptional
- Earnings per share grew by 17.4% annually over the last five years and trumped its peers
- Free cash flow margin increased by 7.5 percentage points over the last five years, giving the company more capital to invest or return to shareholders
Intuitive Surgical’s stock price of $402 implies a valuation ratio of 34.8x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.
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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-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.
