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 best left off your watchlist.
Two Stocks to Sell:
Packaging Corporation of America (PKG)
Market Cap: $17.13 billion
Founded in 1959, Packaging Corporation of America (NYSE: PKG) produces containerboard and corrugated packaging products as well as displays and package protection.
Why Is PKG Not Exciting?
- Muted 5.7% annual revenue growth over the last five years shows its demand lagged behind its industrials peers
- High input costs result in an inferior gross margin of 22.8% that must be offset through higher volumes
- Waning returns on capital imply its previous profit engines are losing steam
Packaging Corporation of America’s stock price of $191.68 implies a valuation ratio of 17.8x forward P/E. If you’re considering PKG for your portfolio, see our FREE research report to learn more.
STERIS (STE)
Market Cap: $25.22 billion
With a mission critical role in preventing healthcare-associated infections, STERIS (NYSE:STE) provides infection prevention products, sterilization services, and medical equipment that help healthcare facilities and life science companies maintain sterile environments.
Why Does STE Fall Short?
- Underwhelming 4.9% return on capital reflects management’s difficulties in finding profitable growth opportunities
STERIS is trading at $258.17 per share, or 24.2x forward P/E. Read our free research report to see why you should think twice about including STE in your portfolio.
One Stock to Buy:
EMCOR (EME)
Market Cap: $26.1 billion
Through its network of over 70 subsidiaries, EMCOR (NYSE:EME) provides electrical, mechanical, and building construction and services
Why Are We Backing EME?
- Annual revenue growth of 15.9% over the past two years was outstanding, reflecting market share gains this cycle
- Share buybacks catapulted its annual earnings per share growth to 47.4%, which outperformed its revenue gains over the last two years
- Improving returns on capital reflect management’s ability to monetize investments
At $584.68 per share, EMCOR trades at 21.6x forward P/E. Is now the right time to buy? See for yourself 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
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