The S&P 500 (^GSPC) is home to the biggest and most well-known companies in the market, making it a go-to index for investors seeking stability. But not all large-cap stocks are created equal - some are struggling with slowing growth, declining margins, or increased competition.

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 positioned to outperform and one that may struggle.

One Industrials Stock to Sell:

Huntington Ingalls (HII)

Market Cap: $12.66 billion

Building Nimitz-class aircraft carriers used in active service, Huntington Ingalls (NYSE: HII) develops marine vessels and their mission systems and maintenance services.

Why Is HII Risky?

1. Sales pipeline suggests its future revenue growth may not meet our standards as its average backlog growth of 4.9% for the past two years was weak
2. Earnings per share fell by 1.1% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
3. Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned

At $322.66 per share, Huntington Ingalls trades at 19.4x forward P/E. If you’re considering HII for your portfolio, see our FREE research report to learn more.

Two Industrials Stocks to Watch:

Parker-Hannifin (PH)

Market Cap: $109.5 billion

Founded in 1917, Parker Hannifin (NYSE: PH) is a manufacturer of motion and control systems for a wide variety of mobile, industrial and aerospace markets.

Why Is PH on Our Radar?

1. Highly efficient business model is illustrated by its impressive 18.2% operating margin, and its profits increased over the last five years as it scaled
2. Performance over the past five years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
3. PH is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its growing cash flow gives it even more resources to deploy

Parker-Hannifin’s stock price of $867.46 implies a valuation ratio of 28x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.

GE Aerospace (GE)

Market Cap: $308.2 billion

One of the original 12 companies on the Dow Jones Industrial Average, General Electric (NYSE: GE) is a multinational conglomerate providing technologies for various sectors including aviation, power, renewable energy, and healthcare.

Why Are We Bullish on GE?

1. Annual revenue growth of 15.2% over the last two years was superb and indicates its market share increased during this cycle
2. Share repurchases have amplified shareholder returns as its annual earnings per share growth of 43.6% exceeded its revenue gains over the last two years
3. Robust free cash flow margin of 18.6% gives it many options for capital deployment

GE Aerospace is trading at $302.36 per share, or 43x forward P/E. Is now the right time to buy? See for yourself in our in-depth 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 9 Market-Beating Stocks. 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-micro-cap company Tecnoglass (+1,754% 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.