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. That said, here is one S&P 500 stock that could deliver good returns and two that may struggle.

Two Stocks to Sell:

Williams-Sonoma (WSM)

Market Cap: $18.98 billion

Started in 1956 as a store specializing in French cookware, Williams-Sonoma (NYSE:WSM) is a specialty retailer of higher-end kitchenware, home goods, and furniture.

Why Does WSM Worry Us?

Ongoing store closures and lackluster same-store sales indicate sluggish demand and a focus on consolidation Disappointing same-store sales over the past two years show customers aren’t responding well to its product selection and store experience Free cash flow margin shrank by 4.8 percentage points over the last year, suggesting the company is consuming more capital to stay competitive

Williams-Sonoma is trading at $153.01 per share, or 18x forward P/E. Read our free research report to see why you should think twice about including WSM in your portfolio, it’s free.

General Dynamics (GD)

Market Cap: $72.52 billion

Creator of the famous M1 Abrahms tank, General Dynamics (NYSE:GD) develops aerospace, marine systems, combat systems, and information technology products.

Why Is GD Not Exciting?

Backlog failed to grow over the past two years, suggesting the company may need to tweak its product roadmap and go-to-market strategy Estimated sales growth of 3.1% for the next 12 months implies demand will slow from its two-year trend Free cash flow margin dropped by 2.6 percentage points over the last five years, implying the company became more capital intensive as competition picked up

General Dynamics’s stock price of $273.99 implies a valuation ratio of 18x forward P/E. Check out our free in-depth research report to learn more about why GD doesn’t pass our bar.

One Stock to Watch:

Ingersoll Rand (IR)

Market Cap: $30.63 billion

Started with the invention of the steam drill, Ingersoll Rand (NYSE:IR) provides mission-critical air, gas, liquid, and solid flow creation solutions.

Why Are We Fans of IR?

Operating profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient Performance over the past five years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 16.2% outpaced its revenue gains Strong free cash flow margin of 15.7% enables it to reinvest or return capital consistently, and its growing cash flow gives it even more resources to deploy

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At $75.92 per share, Ingersoll Rand trades at 22x 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

The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.

While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio 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 175% over the last five years.

Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Sterling Infrastructure (+1,096% five-year return). Find your next big winner with StockStory today for free.