The S&P 500 has been riding a hot streak, recently closing above 5,000 for the first time ever, marking a new all-time high for the benchmark stock market index. So far this year, the S&P 500, which is comprised of the 500 largest publicly traded companies in America, is up 5%, building on a 24% gain achieved in 2023.

The index has closed at a record high on more than 10 occasions through six weeks of the year as the rally in equities continues. These milestones are significant as the S&P 500 is widely considered the main benchmark for U.S. stocks and represents the largest swath of equities in the country.

Yet, the gains in the S&P 500 continue to be lopsided. Big tech stocks are the main driver of the index. Many well-known stocks continue to lag behind as their share price slides lower. Here are three stocks to consider selling in February.

Coca-Cola (KO)

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Coca-Cola (NYSE: KO) recently reported mixed fourth-quarter financial results due to a sales volume decline in North America. For Q4 2023, Coke reported earnings per share (EPS) of 49 cents, in line with Wall Street forecasts. Revenue totaled $10.85 billion U.S., surpassing expectations of $10.68 billion. Sales were up 7% from a year earlier.

However, in its earnings release, Coca-Cola said that higher prices helped it to largely overcome a 1% sales volume decline in the U.S., Canada, and Mexico. The company also stated that sales of its water, sports drinks, and coffee all fell in North America during the quarter. Looking ahead, Coca-Cola mentioned that it expects foreign exchange rates will weigh on both its earnings and revenue for the entire year. The recent financials and guidance have caused concern among investors, resulting in a 2% drop in KO stock. With potential ongoing issues at the company, now might be an opportune time to exit a position in KO stock.

Humana (HUM)

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Humana (NYSE: HUM) saw shares plummet by 16% after the American health insurer reported an unexpected loss for Q4 2023 and issued a bleak outlook for the year ahead. Humana shocked Wall Street with a loss of 11 cents per share on revenue of $25.60 billion. Analysts had anticipated a profit of 89 cents per share on revenue of $25.50 billion. The adverse outcome was attributed to a surge in Medicare Advantage medical costs, as well as higher inpatient utilization rates.

Unfortunately, the future outlook provided by Humana wasn’t any better. The company projected earnings of $16 per share for all of 2024, significantly below the $29 per share anticipated by analysts. Humana has heavily invested in the government-funded Medicare Advantage program, which provides health benefits to senior citizens. Those benefits have surged, placing pressure on Humana’s finances. With HUM shares down 23% this year, it appears to be an S&P 500 stock to divest in February.

AT&T (T)

The Decline of AT&T: Trouble in Telecom Titan’s Territory

AT&T (NYSE:T) finds itself engulfed in a maelstrom of disappointing financial results and a bleak future outlook. The telecommunications juggernaut recently disclosed a lackluster performance in Q4 2023, sending its stock plummeting 4%. The Texas-based company reported an EPS of 54 cents, falling short of the consensus forecast of 56 cents. Although its revenue inched slightly above Wall Street expectations at $32 billion, the underlying numbers paint a worrisome picture.

Troubling Financial Trends

AT&T faces grim prospects as it grapples with a downward spiral in its wireline phone unit, which recorded a substantial 10.3% drop in sales in Q4 2023 compared to the previous year. Although the wireless phone segment managed to eke out a modest 3.9% year-over-year revenue increase, the overarching financial landscape for AT&T appears to be marred by a widespread downtrend. As the company forges ahead, its forecasted EPS of $2.15 to $2.25 for the first quarter of 2024 fell short of Wall Street’s projections of $2.46, signaling a turbulent road ahead for the venerable telecom giant.

Legacy in Decline

AT&T’s stock has been ensnared in a prolonged downward spiral, witnessing a staggering 27% decline over the last five years. The financial downturn not only casts a pall over its near-term outlook but also serves as a stark reminder of the company’s waning prominence in the telecommunications sphere. With these disheartening figures at play, the prevailing sentiment among investors is unequivocal: it seems to be the opportune moment to divest from AT&T.