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.
Even among blue-chip stocks, not all investments are created equal - which is why we built StockStory to help you navigate the market. Keeping that in mind, here is one S&P 500 stock that is leading the market forward and two that could be in trouble.
Two Stocks to Sell:
Royal Caribbean (RCL)
Market Cap: $74.32 billion
Established in 1968, Royal Caribbean Cruises (NYSE:RCL) is a global cruise vacation company renowned for its innovative and exciting cruise experiences.
Why Does RCL Worry Us?
- Scale is a double-edged sword because it limits the company’s growth potential compared to its smaller competitors, as reflected in its below-average annual revenue increases of 9.7% for the last five years
- Capital intensity will likely ramp up in the next year as its free cash flow margin is expected to contract by 7.1 percentage points
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
Royal Caribbean’s stock price of $277.50 implies a valuation ratio of 17.8x forward P/E. Check out our free in-depth research report to learn more about why RCL doesn’t pass our bar.
Regions Financial (RF)
Market Cap: $20.35 billion
Tracing its roots back to 1971 and operating in a region known as the "heart of Dixie," Regions Financial (NYSE:RF) is a financial holding company that provides banking services, wealth management, and specialty financial solutions across the South, Midwest, and Texas.
Why Is RF Not Exciting?
- Net interest income trends were unexciting over the last four years as its 5.3% annual growth was below the typical bank company
- Estimated net interest income growth of 3.4% for the next 12 months implies demand will slow from its four-year trend
- Products and services are facing profitability challenges during this cycle, as seen in its flat tangible book value per share over the last five years
Regions Financial is trading at $22.75 per share, or 1.2x forward P/B. Dive into our free research report to see why there are better opportunities than RF.
One Stock to Watch:
Hubbell (HUBB)
Market Cap: $21.07 billion
A respected player in the electrical segment, Hubbell (NYSE:HUBB) manufactures electronic products for the construction, industrial, utility, and telecommunications markets.
Why Could HUBB Be a Winner?
- Operating profits and efficiency rose over the last five years as it benefited from some fixed cost leverage
- Additional sales over the last two years increased its profitability as the 16.6% annual growth in its earnings per share outpaced its revenue
- Stellar returns on capital showcase management’s ability to surface highly profitable business ventures, and its returns are climbing as it finds even more attractive growth opportunities
At $395.11 per share, Hubbell trades at 22.1x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like 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 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