We’re in an eight-month-old bull market. From Oct. 12 through June 12, the S&P 500 has risen 21.3%, excluding dividends. But a stock screen identifies 20 companies that have been left behind, even though analysts expect their revenues to soar through 2025.
First, let’s take a closer look at the new bull market. Here are price changes and forward price-to-earnings valuations for the 11 sectors of the S&P 500
SPX,
followed by numbers for the full index:
| S&P 500 sector | Price change – Oct. 12 through June 12 | 2022 price change | Price change since the end of 2021 | Forward P/E | Forward P/E – Dec. 31, 2021 |
| Information Technology | 46.5% | -28.9% | -2.1% | 26.2 | 28.1 |
| Communication Services | 33.5% | -31.3% | -19.6% | 17.1 | 20.9 |
| Industrials | 21.2% | -13.5% | -2.8% | 18.3 | 21.4 |
| Consumer Discretionary | 16.8% | -37.2% | -20.5% | 26.8 | 34.2 |
| Materials | 15.4% | -5.0% | -12.6% | 16.6 | 16.6 |
| Financials | 9.2% | -19.8% | -15.5% | 12.9 | 16.1 |
| Real Estate | 8.9% | -32.4% | -28.5% | 17.0 | 25.3 |
| Consumer Staples | 8.3% | -4.0% | -5.2% | 19.8 | 21.4 |
| Healthcare | 7.1% | 2.4% | -7.4% | 17.1 | 17.2 |
| Utilities | 7.1% | -7.8% | -8.1% | 17.1 | 20.4 |
| Energy | -0.2% | -11.2% | 45.4% | 10.6 | 11.1 |
| S&P 500 | 21.3% | -21.9% | -9.0% | 18.7 | 21.5 |
| Source: FactSet | |||||
Three of the top-performing sectors in the new bull market were among the hardest-hit last year. This has been a tech-driven rally. Keep in mind that the benchmark index is weighted by market capitalization. Its concentration in the largest five companies has risen to a record level, according to analysts at Ned Davis Research.
And despite all of them being known as technology innovators, those five companies are actually spread across three sectors. Here they are, with their portfolio percentages within the $408 billion SPDR S&P 500 ETF Trust
SPY,
which tracks the benchmark index. We have also included their expected two-year compound annual growth rates (CAGR) for revenue through calendar 2025. This means, for example, that Nvidia Corp.’s
NVDA,
surprise guidance for a 50% sequential increase in sales during the current quarter is already baked into its baseline 2023 number.
| Company | Ticker | Sector | % of SPY Portfolio | Two-year estimated sales CAGR through 2025 | Price change – Oct. 12 through June 12 | Price change since end of 2021 |
| Apple Inc. |
AAPL, |
Information Technology | 7.46% | 6.8% | 41% | 4% |
| Microsoft Corp. |
MSFT, |
Information Technology | 6.74% | 12.7% | 38% | -1% |
| Amazon.com Inc. |
AMZN, |
Consumer Discretionary | 3.05% | 12.0% | 51% | -24% |
| Nvidia Corp. |
NVDA, |
Information Technology | 2.64% | 25.4% | 170% | 34% |
| Alphabet Inc. Class A |
GOOGL, |
Communication Services | 2.02% | 11.1% | 40% | -15% |
| Alphabet Inc. Class C |
GOOGL, |
Communication Services | 1.77% | 11.1% | 40% | -14% |
| Source: FactSet | ||||||
Click on the tickers for more about each company, index or exchange-traded fund.
Click here for Tomi Kilgore’s detailed guide to the wealth of information available for free on the MarketWatch quote page.
Screening the S&P 500 for those left behind
Starting with the S&P 500, we cut the list down to the 232 companies whose stocks have declined during the eight-month bull market from Oct. 12 through June 12.
Then we looked at estimated revenue numbers among analysts polled by FactSet for calendar 2023, 2024 and 2025. We looked at calendar-year rather than fiscal-year estimates, because about 20% of the S&P 500 have fiscal years that don’t match the calendar. Sales estimates for 2025 weren’t available for eight of the companies.
Among the remaining 226, here are the 20 expected to show the highest two-year CAGR for revenue through 2025:
| Company | Ticker | Industry | Two-year estimated sales CAGR through 2025 | Price change – Oct. 12 through June 12 | Price change since end of 2021 |
| Enphase Energy Inc. |
ENPH, |
Semiconductors | 24.7% | -33% | -3% |
| Insulet Corp. |
PODD, |
Medical Specialties | 18.8% | -3% | 7% |
| ONEOK Inc. |
OKE, |
Oil and Gas Pipelines | 14.8% | -9% | 2% |
| Targa Resources Corp. |
TRGP, |
Gas Distributors | 14.4% | -5% | 34% |
| Cigna Group |
CI, |
Managed Healthcare | 13.9% | -19% | 16% |
| EPAM Systems Inc. |
EPAM, |
Information Technology Services | 13.7% | -33% | -67% |
| Hess Corp. |
HES, |
Integrated Oil | 13.5% | -5% | 82% |
| Charles Schwab Corp. |
SCHW, |
Investment Banks/ Brokers | 13.1% | -35% | -36% |
| Bio-Techne Corp. |
TECH, |
Biotechnology | 12.9% | -5% | -39% |
| Incyte Corp. |
INCY, |
Pharmaceuticals | 12.5% | -23% | -15% |
| Match Group Inc. |
MTCH, |
Internet Software/ Services | 11.7% | -1% | -69% |
| MarketAxess Holdings Inc. |
MKTX, |
Investment Banks/ Brokers | 11.3% | -3% | -34% |
| Starbucks Corp. |
SBUX, |
Restaurants | 11.2% | -1% | -16% |
| Estée Lauder Cos. Inc. Class A |
EL, |
Household/ Personal Care | 10.9% | -28% | -51% |
| Etsy Inc. |
ETSY, |
Internet Retail | 10.8% | -24% | -59% |
| Schlumberger Ltd. |
SLB, |
Contract Drilling | 10.7% | -12% | 57% |
| BlackRock Inc. |
BLK, |
Investment Managers | 10.3% | -4% | -25% |
| Molina Healthcare Inc. |
MOH, |
Managed Healthcare | 9.8% | -13% | -9% |
| Revvity Inc. |
RVTY, |
Medical Specialties | 9.8% | -19% | -44% |
| Charles River Laboratories International Inc. |
CRL, |
Commercial Services | 9.4% | -6% | -45% |
| Source: FactSet | |||||
Looking out to 2025 might seem to be quite a stretch for traders reacting to financial news day to day. But some of these companies might be worth further research if you are looking to make a contrarian investment or two. You might be able to buy something at what might eventually turn out to have been a good price, ahead of a period during which year-over-year revenue comparisons will set up a more positive view among a larger number of investors.
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