1 Mega-Cap Stock on Our Buy List and 2 We Find Risky

Megacap stocks dominate their sectors and their actions influence economies worldwide. The flip side though is that their sheer size means they have less room for explosive growth as scale works against them.

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 whose competitive advantages create flywheel effects and two whose existing offerings may be tapped out.

Two Mega-Cap Stocks to Sell:

Procter & Gamble (PG)

Market Cap: $345.4 billion

Founded by candle maker William Procter and soap maker James Gamble, Procter & Gamble (NYSE:PG) is a consumer products behemoth whose product portfolio spans everything from facial tissues to laundry detergent to feminine care to men’s grooming.

Why Are We Wary of PG?

1. Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
2. Anticipated sales growth of 2.7% for the next year implies demand will be shaky
3. Free cash flow margin didn’t grow over the last year

At $146.79 per share, Procter & Gamble trades at 21.5x forward P/E. If you’re considering PG for your portfolio, see our FREE research report to learn more.

Morgan Stanley (MS)

Market Cap: $335.4 billion

Founded in 1924 during the post-WWI economic boom by former JP Morgan partners, Morgan Stanley (NYSE:MS) is a global financial services firm that provides investment banking, wealth management, and investment management services to corporations, governments, institutions, and individuals.

Why Does MS Fall Short?

1. Annual sales growth of 6.1% over the last five years lagged behind its financials peers as its large revenue base made it difficult to generate incremental demand
2. Earnings growth over the last five years fell short of the peer group average as its EPS only increased by 7.3% annually
3. Large asset base makes it harder to grow tangible book value per share quickly, and its annual tangible book value per share growth of 5.8% over the last five years was below our standards for the financials sector

Morgan Stanley is trading at $222.49 per share, or 18.2x forward P/E. To fully understand why you should be careful with MS, check out our full research report (it’s free).

One Mega-Cap Stock to Buy:

Alphabet (GOOGL)

Market Cap: $4.36 trillion

Started by Stanford students Larry Page and Sergey Brin in a Menlo Park garage, Alphabet (NASDAQ:GOOGL) is the parent company of the eponymous Google Search engine, Google Cloud Platform, and YouTube.

Why Will GOOGL Outperform?

1. Alphabet’s dominant Google Search sits on the pantheon of the best businesses ever. This is reflected in its robust long-term revenue growth and elite operating margin.
2. The company’s profit margins have become even higher over time, speaking to its scale advantages and operating efficiency not only in its core Search business but also in Google Cloud Platform and YouTube.
3. Revenue growth and increasing operating margins are the key ingredients for strong EPS growth. Google has these, and when also factoring in its share repurchases, you can see why EPS has exploded over the long term.

Alphabet’s stock price of $357.25 implies a valuation ratio of 28.9x forward price-to-earnings. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.

Stocks We Like Even More

ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.

Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth 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 Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.