"Too big to fail" is how we would describe the megacap stocks in this article today. While they will likely stand the test of time, it’s not all sunshine and rainbows as their scale can limit their ability to find new sources of growth.
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 industry titan with attractive long-term potential and two that could be stalling.
Two Mega-Cap Stocks to Sell:
Intel (INTC)
Market Cap: $543.6 billion
Inventor of the x86 processor that powered decades of technological innovation in PCs, data centers, and numerous other markets, Intel (NASDAQ: INTC) is a leading manufacturer of computer processors and graphics chips.
Why Should You Sell INTC?
- Annual sales declines of 5.9% for the past five years show its products and services struggled to connect with the market during this cycle
- Sales were less profitable over the last five years as its earnings per share fell by 35.9% annually, worse than its revenue declines
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 19.9 percentage points
Intel’s stock price of $113.35 implies a valuation ratio of 92.3x forward P/E. Dive into our free research report to see why there are better opportunities than INTC.
IBM (IBM)
Market Cap: $215.3 billion
With a corporate history spanning over a century and once known for its iconic mainframe computers, IBM (NYSE: IBM) provides hybrid cloud computing platforms, AI solutions, consulting services, and enterprise infrastructure to help businesses modernize their operations.
Why Does IBM Fall Short?
- Scale is a double-edged sword because it limits the company’s growth potential compared to its smaller competitors, as reflected in its below-average annual revenue increases of 4.5% for the last five years
- Estimated sales growth of 4.8% for the next 12 months is soft and implies weaker demand
- Earnings growth underperformed the sector average over the last five years as its EPS grew by just 6.7% annually
IBM is trading at $228.80 per share, or 18.2x forward P/E. If you’re considering IBM for your portfolio, see our FREE research report to learn more.
One Mega-Cap Stock to Buy:
Palantir Technologies (PLTR)
Market Cap: $325.8 billion
Named after the all-seeing stones in "Lord of the Rings," Palantir Technologies (NASDAQ: PLTR) develops software platforms that help government agencies and enterprises integrate, analyze, and operationalize their data for decision-making.
Why Are We Backing PLTR?
- Winning new contracts that can potentially increase in value as its billings growth has averaged 67.6% over the last year
- Fast payback periods on sales and marketing expenses allow the company to invest heavily and onboard many customers concurrently
- PLTR is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
At $135.29 per share, Palantir Technologies trades at 44x forward price-to-sales. Is now the right time to buy? See for yourself in our full research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI 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%. AppLovin before it ran 753%. Nvidia before it ran 1,178%. 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 (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
