MW These 15 S&P 500 stocks could be contrarian ways to play the market's uneven rally
By Philip van Doorn
These stocks have declined this year, while the consensus estimates for the companies' earnings per share have soared
These companies rank high among the S&P 500 for increases in rolling consensus 12-month earnings estimates, even though the stocks have declined this year.
The S&P 500 has gained 7.4% so far this year, but much of that gain has been driven by a small number of companies, and nearly half of the stocks in the large-cap U.S. benchmark index are down so far for 2026. But among some of this year's decliners, there are compelling numbers that might highlight attractive entry points for long-term investors.
Christine Idzelis explained how the S&P 500's SPX gain during the second quarter has been driven by a handful of companies.
According to LSEG's numbers updated through Tuesday, the 20 companies with the largest gains in market capitalization so far in 2026 have added a combined $5.45 trillion in market cap, while the remaining 480 companies in the S&P 500 have had their combined market cap decline by $738 billion.
The S&P 500 is weighted by market capitalization, which magnifies the effect of this year's gains for some of its largest companies. These include Alphabet $(GOOGL)$, whose market cap has increased by $893 billion, and Nvidia (NVDA), whose market cap has grown by $811 billion.
And the party may well continue rolling along in the same fashion.
Ari H. Wald, a technical analyst at Oppenheimer, wrote in a report on Saturday that he expected the momentum trade for stocks to continue to work for investors.
"It's not what's working that gives us concern, it's what's not working," he wrote, and the italics were his. And he reiterated his advice given in April: "Don't sell the winners, sell the losers."
So much for the concerns of traders and short-term investors. What about long-term investors looking for bargains, or contrarian ideas, or stocks that appear to be priced at more attractive entry points than they were at the end of 2025?
A contrarian stock screen
We can identify candidates by screening the S&P 500 for stocks of companies for which rolling 12-month earnings-per-share estimates have increased significantly, even as share prices have declined this year.
A stock's forward price/earnings ratio is its price divided by analysts' consensus 12-month earnings-per-share estimate. As companies report their quarterly financial results and as some of the companies provide guidance for what to expect over coming quarters, analysts typically increase their earnings estimates, which supports share-price increases over the long term.
Starting with the 195 components of the S&P 500 that have declined at least 5% this year, we removed two companies for which consensus 12-month EPS estimates were negative as of Dec. 31. Then we sorted the remaining 193 companies by how much consensus EPS estimates had risen this year through Tuesday.
Here are the 15 stocks in the S&P 500 among those that have declined at least 5% this year whose consensus EPS estimates among analysts polled by LSEG have increased the most during 2026. To the right are projected compound annual growth rates for the companies' revenue and earnings per share from 2026 through 2028. The growth projections are based on consensus estimates for calendar years, as adjusted by LSEG for companies whose fiscal reporting periods don't match the calendar.
Company Increase in rolling 12-month EPS estimate Forward P/E Forward P/E as of Dec. 31 2026 price change Est. revenue CAGR from 2026 through 2028 Est. EPS CAGR from 2026 through 2028 Palantir Technologies 71% 76.9 173.1 -24% 42.4% 41.5% Take-Two Interactive Software 26% 27.8 37.7 -7% 6.5% 24.8% AppLovin 26% 25.5 45.5 -29% 28.2% 31.6% Eli Lilly 24% 25.4 33.1 -5% 14.0% 18.6% Estee Lauder 23% 24.3 41.1 -27% 4.5% 22.8% Amphenol 22% 23.0 31.7 -12% 12.2% 16.2% Axon Enterprise 20% 43.5 75.5 -31% 29.1% 32.7% Carvana 20% 37.2 59.4 -25% 22.9% 34.6% Omnicom Group 18% 6.2 8.3 -11% 1.4% 13.0% Charles Schwab 18% 13.9 17.8 -8% 8.9% 15.6% Fair Isaac 17% 23.2 38.9 -30% 12.2% 21.3% Fox 16% 11.6 15.2 -12% 2.8% 1.4% Insulet 15% 21.6 45.7 -46% 18.5% 25.1% General Motors 15% 5.4 6.9 -11% 2.4% 7.8% CoStar Group 15% 21.5 49.1 -50% 13.0% 33.5% Source: LSEG
Here are the S&P 500's sectors listed alphabetically, with forward P/E along with revenue and EPS growth projections, so you can see how the numbers compare with those for the 15 stocks:
Sector Forward P/E Forward P/E as of Dec. 31 Est. revenue CAGR from 2026 through 2028 Est. EPS CAGR from 2026 through 2028
Communication Services 21.7 22.2 11.9% 9.6%
Consumer Discretionary 27.1 29.8 8.7% 16.9%
Consumer Staples 22.5 20.9 4.3% 7.7%
Energy 14.0 15.6 -2.6% -1.5%
Financial 14.3 16.7 5.1% 10.6%
Healthcare 17.0 18.4 5.5% 12.4%
Industrials 25.1 24.2 7.2% 14.7%
Information Technology 24.3 26.8 19.6% 27.8%
Materials 18.0 19.3 3.3% 8.4%
Real Estate 36.5 35.2 7.2% 7.3%
Utilities 17.9 17.9 5.4% 9.8%
S&P 500 Index 21.1 22.5 7.9% 15.1%
Source: LSEG
Some of the 15 companies, including Palantir (PLTR), trade at high forward P/E valuations. But they might also have very high growth projections. Palantir's forward P/E has declined significantly this year because the rolling 12-month EPS estimate has increased so much. And Palantir's projected sales and earnings CAGR from 2026 through 2028 are considerably higher than those for the S&P 500 information technology sector.
Schwab $(SCHW)$ stands out with a forward P/E that is lower than that of the financial services sector, and with revenue and EPS CAGR projections that are much higher than those for the sector.
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May 20, 2026 10:05 ET (14:05 GMT)
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