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. Keeping that in mind, here are two S&P 500 stocks leading the market forward and one that could be in trouble.
One Stock to Sell:
Solventum (SOLV)
Market Cap: $13.72 billion
Founded in 1985, Solventum (NYSE: SOLV) develops, manufactures, and commercializes a portfolio of healthcare products and services addressing critical customer and therapeutic patient needs.
Why Do We Pass on SOLV?
- Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
- Sales are projected to be flat over the next 12 months and imply weak demand
- 30.8 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
At $76.53 per share, Solventum trades at 11.7x forward P/E. Read our free research report to see why you should think twice about including SOLV in your portfolio.
Two Stocks to Buy:
TransDigm (TDG)
Market Cap: $70.34 billion
Supplying parts for nearly all aircraft currently in service, TransDigm (NYSE: TDG) develops and manufactures components and systems for military and commercial aviation.
Why Is TDG a Top Pick?
- Existing business lines can expand without risky acquisitions as its organic revenue growth averaged 9.5% over the past two years
- Additional sales over the last five years increased its profitability as the 33.8% annual growth in its earnings per share outpaced its revenue
- Strong free cash flow margin of 19.6% enables it to reinvest or return capital consistently, and its recently improved profitability means it has even more resources to invest or distribute
TransDigm is trading at $1,347 per share, or 30.8x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
Marsh (MRSH)
Market Cap: $81.23 billion
With roots dating back to 1871 and a presence in over 130 countries, Marsh (NYSE: MRSH) is a global professional services firm that helps organizations manage risk, strategy, and workforce challenges through its four specialized businesses.
Why Will MRSH Beat the Market?
- Annual revenue growth of 9.3% over the last five years was superb and indicates its market share increased during this cycle
- Massive revenue base of $27.52 billion makes it a well-known name that influences purchasing decisions
- Robust free cash flow margin of 15.9% gives it many options for capital deployment, and its rising cash conversion increases its margin of safety
Marsh’s stock price of $178.52 implies a valuation ratio of 16.8x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662%. AppLovin before it ran 753%. Nvidia before it ran 1,178%. Each week it produces 6 new names that pass the same tests. Get Our Top 6 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.
