1 S&P 500 Stock on Our Watchlist and 2 We Question

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.

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

Two Stocks to Sell:

Paychex (PAYX)

Market Cap: $38.48 billion

Once known as the go-to service for small business payroll needs, Paychex (NASDAQ:PAYX) provides payroll processing, HR services, employee benefits administration, and insurance solutions to small and medium-sized businesses.

Why Are We Wary of PAYX?

1. 8.7% annual revenue growth over the last five years was slower than its software peers
2. Costs have risen faster than its revenue over the last year, causing its operating margin to decline by 4.2 percentage points
3. Free cash flow margin is forecasted to shrink by 3.9 percentage points in the coming year, suggesting the company will consume more capital to keep up with its competitors

At $107.19 per share, Paychex trades at 5.8x forward price-to-sales. To fully understand why you should be careful with PAYX, check out our full research report (it’s free).

Rockwell Automation (ROK)

Market Cap: $47.82 billion

One of the first companies to address industrial automation, Rockwell Automation (NYSE:ROK) sells products that help customers extract more efficiency from their machinery.

Why Is ROK Not Exciting?

1. Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
2. Performance over the past two years shows each sale was less profitable as its earnings per share dropped by 7.2% annually, worse than its revenue
3. Waning returns on capital imply its previous profit engines are losing steam

Rockwell Automation is trading at $425.52 per share, or 34.9x forward P/E. Dive into our free research report to see why there are better opportunities than ROK.

One Stock to Watch:

Corpay (CPAY)

Market Cap: $22.89 billion

Formerly known as FLEETCOR until its 2024 rebrand, Corpay (NYSE:CPAY) provides specialized payment solutions for businesses to manage vehicle expenses, corporate payments, and lodging costs with enhanced control and reporting capabilities.

Why Could CPAY Be a Winner?

1. Offerings and unique value proposition resonate with customers, as seen in its above-market 11.8% annual sales growth over the last five years
2. Performance over the past five years was aided by share buybacks, which enabled its earnings per share to grow faster than its revenue
3. Market-beating return on equity illustrates that management has a knack for investing in profitable ventures

Corpay’s stock price of $318.70 implies a valuation ratio of 13.2x forward P/E. Is now the time to initiate a position? See for yourself in our full research report, it’s free.

Stocks We Like Even More

Check out the high-quality names we’ve flagged in 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-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.