1 Large-Cap Stock on Our Buy List and 2 We Turn Down
Large-cap stocks have the power to shape entire industries thanks to their size and widespread influence. With such vast footprints, however, finding new areas for growth is much harder than for smaller, more agile players.
This dynamic can trouble even the most skilled investors, but luckily for you, we started StockStory to help you navigate these trade-offs and uncover exceptional companies that break the mold. Keeping that in mind, here is one large-cap stock with attractive long-term potential and two whose momentum may slow.
Two Large-Cap Stocks to Sell:
Bristol-Myers Squibb (BMY)
Market Cap: $105.2 billion
With roots dating back to 1887 and a transformative merger in 1989 that gave the company its current name, Bristol-Myers Squibb (NYSE:BMY) discovers, develops, and markets prescription medications for serious diseases including cancer, blood disorders, immunological conditions, and cardiovascular diseases.
Why Does BMY Fall Short?
- Annual sales growth of 3.8% over the last two years lagged behind its healthcare peers as its large revenue base made it difficult to generate incremental demand
- Projected sales decline of 6.4% for the next 12 months points to a tough demand environment ahead
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
Bristol-Myers Squibb’s stock price of $51.68 implies a valuation ratio of 8.4x forward P/E. Read our free research report to see why you should think twice about including BMY in your portfolio.
AIG (AIG)
Market Cap: $41.18 billion
With roots dating back to 1919 when it began as a small insurance agency in Shanghai, China, AIG (NYSE:AIG) is a global insurance organization that provides commercial and personal insurance solutions to businesses and individuals across more than 200 countries.
Why Do We Think AIG Will Underperform?
- Net premiums earned contracted by 5.8% annually over the last five years, showing unfavorable market dynamics this cycle
- Earnings per share lagged its peers over the last two years as they only grew by 1% annually
- Book value per share was flat over the last five years, indicating it’s failed to build equity value this cycle
At $76.27 per share, AIG trades at 1x forward P/B. Check out our free in-depth research report to learn more about why AIG doesn’t pass our bar.
One Large-Cap Stock to Buy:
ADP (ADP)
Market Cap: $104.6 billion
Processing one out of every six paychecks in the United States, ADP (NASDAQ:ADP) provides cloud-based human capital management solutions that help businesses manage payroll, benefits, talent acquisition, and HR administration.
Why Is ADP a Top Pick?
- Offerings and unique value proposition resonate with customers, as seen in its above-market 7.5% annual sales growth over the last five years
- Robust free cash flow margin of 20.5% gives it many options for capital deployment, and its rising cash conversion increases its margin of safety
- Returns on capital are growing as management capitalizes on its market opportunities
ADP is trading at $259.01 per share, or 23.4x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free for active Edge members.
Stocks We Like Even More
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in 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 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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