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 three S&P 500 stocks to steer clear of and a few alternatives to consider.
Campbell's (CPB)
Market Cap: $10.22 billion
With its iconic canned soup as its cornerstone product, Campbell's (NASDAQ: CPB) is a packaged food company with an illustrious portfolio of brands.
Why Are We Wary of CPB?
- Falling unit sales over the past two years imply it may need to invest in product improvements to get back on track
- Demand is forecasted to shrink as its estimated sales for the next 12 months are flat
- Day-to-day expenses have swelled relative to revenue over the last year as its operating margin fell by 3.6 percentage points
Campbell’s stock price of $34.39 implies a valuation ratio of 11.2x forward P/E. Dive into our free research report to see why there are better opportunities than CPB.
Keysight (KEYS)
Market Cap: $27.98 billion
Spun off from Hewlett-Packard in 2014, Keysight (NYSE: KEYS) offers electronic measurement products for use in various sectors.
Why Are We Out on KEYS?
- Sales pipeline suggests its future revenue growth won’t meet our standards as its backlog averaged 3.3% declines over the past two years
- Earnings per share have contracted by 9.8% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance
- Eroding returns on capital suggest its historical profit centers are aging
At $162.56 per share, Keysight trades at 22.3x forward P/E. To fully understand why you should be careful with KEYS, check out our full research report (it’s free).
FedEx (FDX)
Market Cap: $53.23 billion
Sporting one of the largest air cargo fleets in the world, FedEx (NYSE: FDX) is a global provider of parcel and cargo delivery services.
Why Do We Think FDX Will Underperform?
- Sales tumbled by 2.6% annually over the last two years, showing market trends are working against its favor during this cycle
- Estimated sales for the next 12 months are flat and imply a softer demand environment
- Earnings per share lagged its peers over the last two years as they only grew by 2% annually
FedEx is trading at $222.80 per share, or 10.2x forward P/E. If you’re considering FDX for your portfolio, see our FREE research report to learn more.
High-Quality Stocks for All Market Conditions
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our Top 6 Stocks for this week. 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-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free.
