Here Are the Top-Performing Stocks From the S&P 500 This Year

Globe and Mail

6 days ago

The stock market has been one heck of a seesaw in 2025.
A bit over a month ago, the S&P 500 was down more than 15% on the year and narrowly avoided an official bear market (in fact, it closed down 19% from its highs and touched bear territory intraday). The Nasdaq officially entered one.
By mid-May, the S&P 500 soared back into the green for 2025. It was the fastest recovery in over 40 years, with the index erasing its 15% year-to-date loss in less than six weeks. It's a good reminder that one of the worst mistakes we can make is to panic sell during times of market stress.
The market is now telling us two things. First, it's to expect a quicker-than-anticipated resolution to the tariff issues and trade wars. And alongside that, the assumption is that inflation remains under control, which will allow the Fed to resume the rate-cutting process. This should provide a further tailwind to equity prices.
An underlying downward trend in inflation combined with better-than-expected corporate earnings also helped propel the S&P 500 back near record highs.
Sector Rotation Evident as Technology Rebounds
There's no doubt that a strong 2024 was met with heavy selling early this year. Markets came under pressure as volatility increased amid uncertainty surrounding President Trump's tariffs.
We also saw defensive sectors take the lead as market participants altered positioning. Even after this latest rally, two of the top three S&P sectors this year include utilities and consumer staples. These are two sectors we'd expect to hold up relatively well during corrections and bear markets.
But things have quickly changed course with the technology sector roaring back. Unique catalysts such as the artificial intelligence theme resulted in the more aggressive pockets of the market returning to the forefront. The information technology sector is the leading sector over the past month; this is aligned with the secular bull thesis, as we'd expect tech stocks to outperform in a bull market.
The media-hyped concentration risk at the very top of the cap-weighted S&P 500 would have us believe that investors are becoming increasingly reliant on a smaller number of companies to lead their portfolios. Yet none of the top 25 S&P 500 constituents (by index weight) are included in the best 3 performers in 2025.
The evidence is now pointing to the notion that this correction in the S&P 500 has come to an abrupt end. Let's take a look at the top three performers so far this year from the blue-chip index.
S&P 500 Gold: NRG Energy
An integrated power company operating in the United States, NRG Energy NRG is leading the pack in 2025. Renewed strength in rate-sensitive utilities provides a durable backing for this industry leader.
NRG Energy is involved in producing and selling electricity and related services to residential, commercial, industrial, and wholesale customers. The company generates electricity using natural gas, coal, oil, solar, nuclear, and battery storage.
NRG stock is displaying relative strength, recently surging to 52-week highs. Shares have already advanced more than 70% this year:
The utility provider has put together an impressive earnings history, surpassing earnings estimates in three of the last four quarters. Just a few weeks ago, the company reported first-quarter earnings of $2.62/share, a 45.6% surprise over the $1.80/share consensus estimate.
NRG shares received a boost as analysts covering the company have been increasing their earnings estimates lately. For the full year, earnings estimates have risen 0.82% in the past 60 days. The 2025 Zacks Consensus EPS Estimate now stands at $7.34 per share, reflecting a potential growth rate of 10.5% relative to the prior year.
S&P 500 Silver: Palantir
A leading provider of artificial intelligence systems, Palantir PLTR took the top spot in 2024 (after being added to the S&P 500 in September) and has followed through this year. The company has benefitted from numerous strategic partnerships, including a recent collaboration with Bain & Company to integrate advanced AI solutions to diverse industries.
Last year, Palantir announced that it extended its long-standing partnership with the U.S. Army, further aiding the delivery of its Army Vantage capability used to perform essential missions and enable quicker decision-making.
The intelligence software and data analytics provider generates more than 50% of its revenue from government agencies. Late last year, the federal government issued the company a higher rating for secure cloud computing services, which should accelerate the handling of extremely sensitive data as part of Palantir's cloud offering.
Following the latest correction, PLTR shares have climbed back to 52-week highs and are up more than 60% in 2025:
Analysts covering PLTR remain bullish and have increased their second-quarter EPS estimates by 7.69% in the past 60 days. The Q2 Zacks Consensus Estimate now stands at 14 cents per share, reflecting a 55.6% potential growth rate versus the year-ago period.
S&P 500 Bronze: Howmet Aerospace
Rounding out the top 3 in terms of S&P 500 returns so far this year is defense giant Howmet Aerospace HWM. The company is a global provider of advanced engineered solutions for the aerospace and transportation industries.
A Zacks Rank #1 (Strong Buy), Howmet stock has been a steady performer, surging more than 50% year-to-date:
Howmet has built an incredible track record in terms of surpassing earnings estimates; the company hasn't missed the EPS mark since 2020. The aerospace and defense leader delivered a trailing four-quarter average earnings surprise of 8.9%.
Howmet continues to witness rising earnings estimates as the company benefits from momentum in the commercial aerospace market. Analysts covering HWM increased their full-year EPS estimates by 6.13% in the past 60 days. The 2025 Zacks Consensus Estimate now stands at $3.46/share, translating to a healthy 28.6% growth rate versus last year.
Final Thoughts
These three market leaders are showing strong growth metrics and are poised to continue their outperformance.
While defensive stocks led the charge in the first few months of 2025, other sectors like technology have resumed the driver's seat and are playing a big part in the S&P 500's resurgence. The bulls are hoping that this V-shaped recovery will be followed by more strength in the months to come.
Studying the top performers is a great way to gain perspective. Be sure to explore all that Zacks has to offer so you're ready to take advantage of the next leaders.
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NRG Energy, Inc. (NRG): Free Stock Analysis Report
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