Large-cap stocks have the power to shape entire industries thanks to their size and widespread influence. With such vast footprints, however, finding new areas for growth is much harder than for smaller, more agile players.
This is precisely where StockStory comes in - our job is to find you high-quality companies that can win regardless of the conditions. Keeping that in mind, here is one large-cap stock whose competitive advantages creates flywheel effects and two whose momentum may slow.
Two Large-Cap Stocks to Sell:
Paychex (PAYX)
Market Cap: $40.27 billion
Once known as the go-to service for small business payroll needs, Paychex (NASDAQ: PAYX) provides payroll processing, HR services, employee benefits administration, and insurance solutions to small and medium-sized businesses.
Why Are We Wary of PAYX?
- 8.7% annual revenue growth over the last five years was slower than its software peers
- Expenses have increased as a percentage of revenue over the last year as its operating margin fell by 4.2 percentage points
- Capital intensity will likely ramp up in the next year as its free cash flow margin is expected to contract by 3.9 percentage points
At $112.19 per share, Paychex trades at 6.1x forward price-to-sales. Dive into our free research report to see why there are better opportunities than PAYX.
Old Dominion Freight Line (ODFL)
Market Cap: $32.79 billion
With its name deriving from the Commonwealth of Virginia’s nickname, Old Dominion (NASDAQ: ODFL) delivers less-than-truckload (LTL) and full-container load freight.
Why Does ODFL Give Us Pause?
- Declining unit sales over the past two years suggest it might have to lower prices to accelerate growth
- Earnings per share have contracted by 5.8% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance
- Waning returns on capital imply its previous profit engines are losing steam
Old Dominion Freight Line’s stock price of $156.86 implies a valuation ratio of 32.1x forward P/E. Read our free research report to see why you should think twice about including ODFL in your portfolio.
One Large-Cap Stock to Watch:
Rocket Companies (RKT)
Market Cap: $54.52 billion
Born in Detroit during the 1980s and evolving into a tech-driven financial powerhouse, Rocket Companies (NYSE: RKT) is a fintech company that provides digital mortgage lending, real estate services, and personal finance solutions through its technology platform.
Why Is RKT on Our Radar?
- Expected net interest income growth of 33.1% for the next year suggests its market share will rise
- Capital strength will likely rise over the next 12 months as its expected tangible book value per share growth of 427% is robust
- Market-beating return on equity illustrates that management has a knack for investing in profitable ventures
Rocket Companies is trading at $19.33 per share, or 3.3x forward P/B. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.
Stocks We Like Even More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
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-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.
