1 S&P 500 Stock to Target This Week and 2 to Avoid
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?
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