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:
Mohawk Industries (MHK)
Market Cap: $7.53 billion
Established in 1878, Mohawk Industries (NYSE:MHK) is a leading producer of floor-covering products for both residential and commercial applications.
Why Do We Think MHK Will Underperform?
- 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
- Underwhelming 3.9% return on capital reflects management’s difficulties in finding profitable growth opportunities, and its falling returns suggest its earlier profit pools are drying up
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
Mohawk Industries is trading at $121.18 per share, or 12.1x forward P/E. To fully understand why you should be careful with MHK, check out our full research report (it’s free).
Two Stocks to Watch:
AMD (AMD)
Market Cap: $264.7 billion
Founded in 1969 by a group of former Fairchild semiconductor executives led by Jerry Sanders, Advanced Micro Devices (NASDAQ:AMD) is one of the leading designers of computer processors and graphics chips used in PCs and data centers.
Why Does AMD Stand Out?
- Market share has increased this cycle as its 16.3% annual revenue growth over the last two years was exceptional
- Market share is on track to rise over the next 12 months as its 22.7% projected revenue growth implies demand will accelerate from its two-year trend
- Earnings per share have comfortably outperformed the peer group average over the last five years, increasing by 32% annually
AMD’s stock price of $164.81 implies a valuation ratio of 32.5x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Broadridge (BR)
Market Cap: $31.26 billion
Processing over $10 trillion in equity and fixed income trades daily and managing proxy voting for over 800 million equity positions, Broadridge Financial Solutions (NYSE:BR) provides technology-driven solutions that power investing, governance, and communications for banks, broker-dealers, asset managers, and public companies.
Why Is BR on Our Radar?
- Offerings and unique value proposition resonate with customers, as seen in its above-market 8.8% annual sales growth over the last five years
- Performance over the past five years shows its incremental sales were more profitable, as its annual earnings per share growth of 11.2% outpaced its revenue gains
- Free cash flow margin jumped by 4.2 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
At $265.03 per share, Broadridge trades at 28.9x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
High-Quality Stocks for All Market Conditions
Trump’s April 2024 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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