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1 Mega-Cap Stock on Our Watchlist and 2 We Turn Down
“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.
Sound complicated? With StockStory, it doesn’t have to be. Our job is to find you high-quality companies that can win regardless of the conditions. Keeping that in mind, here is one industry titan that still has big upside potential and two whose momentum may slow.
Two Mega-Cap Stocks to Sell:
JPMorgan Chase (JPM)
Market Cap: $902.2 billion
Tracing its roots back to 1799 when its earliest predecessor was founded by Aaron Burr, JPMorgan Chase (NYSE:JPM) is a leading financial services company offering investment banking, consumer banking, commercial banking, and asset management services globally.
Why Are We Hesitant About JPM?
- The company has faced growth challenges as its 8% annual revenue increases over the last two years fell short of other banking companies
- Inferior net interest margin of 2.5% means it must compensate for lower profitability through increased loan originations
- Overall productivity is expected to decrease over the next year as Wall Street thinks its efficiency ratio will degrade by 1.8 percentage points
JPMorgan Chase’s stock price of $339.25 implies a valuation ratio of 2.5x forward P/B. Check out our free in-depth research report to learn more about why JPM doesn’t pass our bar.
Berkshire Hathaway (BRK.A)
Market Cap: $1.14 trillion
Led by legendary investor Warren Buffett since 1965, transforming it from a struggling textile manufacturer into a corporate giant, Berkshire Hathaway (NYSE:BRK.A) is a diversified holding company that owns businesses across insurance, railroads, utilities, manufacturing, retail, and services sectors.
Why Does BRK.A Fall Short?
- The company has faced growth challenges as its 4.2% annual revenue increases over the last five years fell short of other financials companies
- Earnings growth underperformed the sector average over the last two years as its EPS grew by just 7% annually
Berkshire Hathaway is trading at $797,995 per share, or 23.7x forward P/E. Read our free research report to see why you should think twice about including BRK.A in your portfolio.
One Mega-Cap Stock to Watch:
Applied Materials (AMAT)
Market Cap: $324.8 billion
Founded in 1967 as the first company to develop tools for other businesses in the semiconductor industry, Applied Materials (NASDAQ:AMAT) is the largest provider of semiconductor wafer fabrication equipment.
Why Could AMAT Be a Winner?
- Demand will likely accelerate over the next 12 months as its forecasted revenue growth of 44.8% is above its two-year trend
- Disciplined cost controls and effective management resulted in a strong two-year operating margin of 29.9%
- Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures
At $409.80 per share, Applied Materials trades at 24.4x forward P/E. Is now the right time to buy? Find out 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 is 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% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. 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 (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.