Large-cap stocks usually command their industries because they have the scale to drive market trends. The flip side though is that their sheer size can limit growth as expanding further becomes an increasingly challenging task.
These trade-offs can cause headaches for even the most seasoned professionals, which is why we started StockStory - to help you find high-quality companies that can grow their earnings no matter what. Keeping that in mind, here is one large-cap stock that still has big upside potential and two that could be stalling.
Two Large-Cap Stocks to Sell:
Teradyne (TER)
Market Cap: $61.46 billion
Sporting most major chip manufacturers as its customers, Teradyne (NASDAQ:TER) is a US-based supplier of automated test equipment for semiconductors as well as other technologies and devices.
Why Does TER Fall Short?
- Annual revenue growth of 3.4% over the last five years was below our standards for the semiconductor sector
- Estimated sales growth of 17.3% for the next 12 months implies demand will slow from its two-year trend
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 10.7 percentage points
Teradyne is trading at $391.25 per share, or 54.5x forward P/E. If you’re considering TER for your portfolio, see our FREE research report to learn more.
Chubb (CB)
Market Cap: $121.1 billion
Dating back to when a Civil War veteran created a frost-proof water meter, Chubb Limited (NYSE:CB) provides commercial and personal property and casualty insurance, reinsurance, and life insurance products to a diverse client base across 54 countries.
Why Does CB Give Us Pause?
- Large revenue base constrains its growth potential, as seen in its unexciting 7.5% annualized increases in net premiums earned over the last two years fell below our expectations for the insurance sector
- Estimated sales growth of 2.6% for the next 12 months implies demand will slow from its two-year trend
- Earnings growth underperformed the sector average over the last two years as its EPS grew by just 15.9% annually
Chubb’s stock price of $313.55 implies a valuation ratio of 1.5x forward P/B. Read our free research report to see why you should think twice about including CB in your portfolio.
One Large-Cap Stock to Buy:
HCA Healthcare (HCA)
Market Cap: $81.49 billion
With roots dating back to 1968 and a network spanning 20 states, HCA Healthcare (NYSE:HCA) operates a network of 190 hospitals and 150+ outpatient facilities providing a full range of medical services across the US and England.
Why Will HCA Outperform?
- Unparalleled scale of $76.39 billion in revenue gives it negotiating leverage and staying power in an industry with high barriers to entry
- Share repurchases over the last five years enabled its annual earnings per share growth of 19.9% to outpace its revenue gains
- Stellar returns on capital showcase management’s ability to surface highly profitable business ventures
At $361.28 per share, HCA Healthcare trades at 12x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
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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-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.