1 S&P 500 Stock for Long-Term Investors and 2 That Underwhelm 改写： 1 S&P 500 Stock Worth Holding for the Long Run and 2 That Fall Short

Spotlight on S&P 500: Leaders and Laggards

The S&P 500 index is home to many top-performing companies, but not every stock in this group is thriving. Some businesses are struggling due to outdated strategies, financial challenges, or industry shifts that have left them behind.

While some large-cap names have lost momentum, StockStory aims to help you distinguish the true market leaders from those falling behind. With that in mind, let’s look at one standout S&P 500 stock worth your attention, and two others you may want to avoid.

Two Stocks to Consider Selling

Autodesk (ADSK)

Market Capitalization: $49.39 billion

Autodesk (NASDAQ:ADSK) began with AutoCAD in the 1980s and has since grown into a robust platform offering design software for architecture, engineering, construction, manufacturing, and entertainment. Their tools help professionals design, simulate, and visualize complex projects.

Reasons for Caution with ADSK:

• Autodesk’s annual revenue has increased by 13.7% over the past five years, but this pace lags behind other software companies.
• Intense competition forces Autodesk to ramp up spending on sales and marketing, often with limited returns.
• The company’s operating margin has remained flat year-over-year, indicating it hasn’t improved efficiency with its fixed costs.

Currently, Autodesk shares trade at $236.75, reflecting a forward price-to-sales ratio of 6.

Hormel Foods (HRL)

Market Capitalization: $13.65 billion

Hormel Foods (NYSE:HRL), best known for its SPAM brand, produces a range of packaged foods including meats, poultry, shelf-stable items, and spreads.

Why We’re Wary of HRL:

• Hormel has seen declining unit sales over the last two years, relying on price hikes to maintain revenue.
• The company faces stiff competition, as many of its products are easily replaced by alternatives. This has resulted in a modest gross margin of 16.2%, which requires higher sales volumes to compensate.
• Over the past three years, profitability has slipped—earnings per share have dropped by 8.8% annually, while revenue has remained flat.

Hormel Foods is currently priced at $24.85 per share, with a forward P/E ratio of 16.8.

One Stock to Watch

Xylem (XYL)

Market Capitalization: $32.08 billion

Xylem (NYSE:XYL) was created through a corporate spinoff and specializes in designing and servicing engineered products, with a primary focus on water-related applications.

Why We’re Optimistic About XYL:

• Xylem has delivered impressive annual revenue growth of 13.1% over the past five years, capturing greater market share.
• The company’s earnings per share have climbed by 19.8% annually during the same period, outpacing its revenue growth and boosting profitability.
• Free cash flow margin has improved by 3.7 percentage points over five years, providing more resources for investment or shareholder returns.

At $131.37 per share, Xylem trades at a forward P/E of 23.3. Is this a good entry point?

Our Top Stock Picks

Relying on just a handful of stocks can leave your portfolio vulnerable. Now is the time to secure high-quality investments before the market broadens and opportunities diminish.

Don’t wait for the next market swing. Discover our Top 5 Strong Momentum Stocks for this week—a handpicked selection of high-quality companies that have outperformed the market with a 244% return over the past five years (as of June 30, 2025).

Our 2020 picks included well-known names like Nvidia, which soared 1,326% from June 2020 to June 2025, and lesser-known companies such as Comfort Systems, which delivered a 782% five-year return. Start your search for the next breakout stock with StockStory today.