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.
Picking the right S&P 500 stocks requires more than just buying big names, and that’s where StockStory comes in. Keeping that in mind, here are two S&P 500 stocks that could deliver good returns and one that could be in trouble.
One Stock to Sell:
M&T Bank (MTB)
Market Cap: $31.65 billion
Tracing its roots back to 1856 when it was founded as Manufacturers and Traders Bank in Buffalo, New York, M&T Bank (NYSE:MTB) is a regional bank holding company that provides retail and commercial banking, trust, wealth management, and investment services to consumers and businesses.
Why Are We Wary of MTB?
- Sales trends were unexciting over the last two years as its 3.9% annual growth was below the typical banking company
- Estimated net interest income growth of 3.2% for the next 12 months implies demand will slow from its five-year trend
- Projected tangible book value per share growth of 7.9% for the next 12 months suggests sluggish capital generation
At $219.13 per share, M&T Bank trades at 1.2x forward P/B. To fully understand why you should be careful with MTB, check out our full research report (it’s free).
Two Stocks to Watch:
Comfort Systems (FIX)
Market Cap: $60.72 billion
Formed through the merger of 12 companies, Comfort Systems (NYSE:FIX) provides mechanical and electrical contracting services.
What Makes FIX Stand Out?
- Demand is greater than supply as the company’s 56% average backlog growth over the past two years shows it’s securing new contracts and accumulating more orders than it can fulfill
- Free cash flow margin jumped by 15.1 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
- Returns on capital are climbing as management makes more lucrative bets
Comfort Systems’s stock price of $1,730 implies a valuation ratio of 31.7x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
Fastenal (FAST)
Market Cap: $58.24 billion
Founded in 1967, Fastenal (NASDAQ:FAST) provides industrial and construction supplies, including fasteners, tools, safety products, and many other product categories to businesses globally.
Why Is FAST Interesting?
- Offerings are mission-critical for businesses and result in a best-in-class gross margin of 45.4%
- Healthy operating margin of 20.4% shows it’s a well-run company with efficient processes
- Free cash flow margin increased by 5.1 percentage points over the last five years, giving the company more capital to invest or return to shareholders
Fastenal is trading at $50.77 per share, or 37.3x 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
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.