3 S&P 500 Stocks Walking a Fine Line

While the S&P 500 (^GSPC) includes industry leaders, not every stock in the index is a winner. Some companies are past their prime, weighed down by poor execution, weak financials, or structural headwinds.

Picking the right S&P 500 stocks requires more than just buying big names, and that’s where StockStory comes in. That said, here are three S&P 500 stocks to steer clear of and a few alternatives to consider.

J. M. Smucker (SJM)

Market Cap: $11.53 billion

Best known for its fruit jams and spreads, J.M Smucker (NYSE:SJM) is a packaged foods company whose products span from peanut butter and coffee to pet food.

Why Should You Dump SJM?

1. Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
2. Day-to-day expenses have swelled relative to revenue over the last year as its operating margin fell by 27.1 percentage points
3. ROIC of 2.2% reflects management’s challenges in identifying attractive investment opportunities, and its shrinking returns suggest its past profit sources are losing steam

At $108.08 per share, J. M. Smucker trades at 11.5x forward P/E. Read our free research report to see why you should think twice about including SJM in your portfolio.

Expeditors (EXPD)

Market Cap: $16.22 billion

Expeditors (NYSE:EXPD) offers air and ocean freight as well as brokerage services.

Why Are We Out on EXPD?

1. Products and services are facing significant end-market challenges during this cycle as sales have declined by 5.5% annually over the last two years
2. Earnings per share have dipped by 4.4% annually over the past two years, which is concerning because stock prices follow EPS over the long term
3. Eroding returns on capital suggest its historical profit centers are aging

Expeditors’s stock price of $119.48 implies a valuation ratio of 22.7x forward P/E. Check out our free in-depth research report to learn more about why EXPD doesn’t pass our bar.

Morgan Stanley (MS)

Market Cap: $256.5 billion

Founded in 1924 during the post-WWI economic boom by former JP Morgan partners, Morgan Stanley (NYSE:MS) is a global financial services firm that provides investment banking, wealth management, and investment management services to corporations, governments, institutions, and individuals.

Why Does MS Fall Short?

1. Earnings per share lagged its peers over the last five years as they only grew by 9.2% annually
2. Sizable asset base leads to capital growth challenges as its 1.6% annual tangible book value per share increases over the last five years fell short of other financials companies

Morgan Stanley is trading at $160.70 per share, or 17.9x forward P/E. Dive into our free research report to see why there are better opportunities than MS.

Stocks We Like More

Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.

Take advantage of the rebound by checking out our 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

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.