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Large-cap stocks are known for their staying power and ability to weather market storms better than smaller competitors. However, their sheer size makes it more challenging to maintain high growth rates as they’ve already captured significant portions of their markets.

This is precisely where StockStory comes in - our job is to find you high-quality companies that can win regardless of the conditions. Keeping that in mind, here is one large-cap stock with attractive long-term potential and two whose existing offerings may be tapped out.

Two Large-Cap Stocks to Sell:

Kraft Heinz (KHC)

Market Cap: $33.72 billion

The result of a 2015 mega-merger between Kraft and Heinz, Kraft Heinz (NASDAQ:KHC) is a packaged foods giant whose products span coffee to cheese to packaged meat.

Why Is KHC Risky?

1. Shrinking unit sales over the past two years imply it may need to invest in product improvements to get back on track

2. Sales are projected to tank by 1.6% over the next 12 months as demand evaporates further

3. Efficiency has decreased over the last year as its operating margin fell by 11.2 percentage points

Kraft Heinz is trading at $28.54 per share, or 10.6x forward P/E. Dive into our free research report to see why there are better opportunities than KHC.

Sherwin-Williams (SHW)

Market Cap: $88.42 billion

Widely known for its success in the paint industry, Sherwin-Williams (NYSE:SHW) is a manufacturer of paints, coatings, and related products.

Why Are We Wary of SHW?

1. Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion

2. Anticipated sales growth of 2.5% for the next year implies demand will be shaky

3. 8.5 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position

At $353.57 per share, Sherwin-Williams trades at 28.8x forward P/E. Read our free research report to see why you should think twice about including SHW in your portfolio, it’s free.

One Large-Cap Stock to Buy:

O'Reilly (ORLY)

Market Cap: $77.68 billion

Serving both the DIY customer and professional mechanic, O’Reilly Automotive (NASDAQ:ORLY) is an auto parts and accessories retailer that sells everything from fuel pumps to car air fresheners to mufflers.

Why Should You Buy ORLY?

1. Locations open for at least a year are seeing increased demand as same-store sales have averaged 4.5% growth over the past two years

2. Collection of products is difficult to replicate at scale and leads to a best-in-class gross margin of 51.3%

3. Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends