1 S&P 500 Stock on Our Watchlist and 2 Facing Challenges

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.

Some large-cap stocks are past their peak, and StockStory is here to help you separate the winners from the laggards. Keeping that in mind, here is one S&P 500 stock that could deliver good returns and two that could be in trouble.

Two Stocks to Sell:

West Pharmaceutical Services (WST)

Market Cap: $17.65 billion

Founded in 1923 and serving as a critical link in the pharmaceutical supply chain, West Pharmaceutical Services (NYSE:WST) manufactures specialized packaging, containment systems, and delivery devices for injectable drugs and healthcare products.

Why Are We Wary of WST?

1. 1.6% annual revenue growth over the last two years was slower than its healthcare peers
2. Efficiency has decreased over the last five years as its adjusted operating margin fell by 3.9 percentage points
3. Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability

At $245.45 per share, West Pharmaceutical Services trades at 36.6x forward P/E. Check out our free in-depth research report to learn more about why WST doesn’t pass our bar.

Fiserv (FI)

Market Cap: $74.83 billion

Powering over 1 billion accounts and processing more than 12,000 financial transactions per second globally, Fiserv (NYSE:FI) provides payment processing and financial technology solutions that enable merchants, banks, and credit unions to accept payments and manage financial transactions.

Why Are We Cautious About FI?

1. Sizable revenue base leads to growth challenges as its 6.2% annual revenue increases over the last two years fell short of other financials companies
2. Low return on equity reflects management’s struggle to allocate funds effectively

Fiserv is trading at $138 per share, or 12.5x forward P/E. Read our free research report to see why you should think twice about including FI in your portfolio.

One Stock to Watch:

PayPal (PYPL)

Market Cap: $66.93 billion

Originally spun off from eBay in 2015 after being acquired by the auction giant in 2002, PayPal (NASDAQ:PYPL) operates a global digital payments platform that enables consumers and merchants to send, receive, and process payments online and in person.

Why Does PYPL Stand Out?

1. Annual revenue growth of 10.9% over the last five years was above the sector average and underscores its products and services value to customers
2. Share buybacks lifted its annual earnings per share growth to 12.6%, which outperformed its revenue gains over the last two years
3. ROE punches in at 20%, illustrating management’s expertise in identifying profitable investments

PayPal’s stock price of $70.10 implies a valuation ratio of 13.4x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

High-Quality Stocks for All Market Conditions

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at Top 5 Growth Stocks for this month. 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-small-cap company Exlservice (+354% 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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