S&P 500 buyers who sold in May and went away did not miss a lot. But that is to not say large features could not be had within the fifth month of the yr.
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A handful of S&P 500 shares together with data expertise play NortonLifeLock (NLOK), client discretionary Ford Motor (F), supplies firm Nucor (NUE) and Baker Hughes (BKR), soared 20% or extra simply within the month of May alone, says an Investor’s Business Daily evaluation of knowledge from S&P Global Market Intelligence and MarketSmith.
What’s that imply on your portfolio? All instructed, had you invested $10,000 in January and reinvested your cash into the highest inventory at the moment within the S&P 500 every month this yr, together with in May, you’d have $45,906 now. That’s a exceptional five-month achieve of 359% from holding 5 shares. That even beats the spectacular rise within the S&P 500 this yr to date, which turned a $10,000 funding into $11,193.
Investors prepared to pinpoint sectors contained in the S&P 500 are making some critical cash — even as S&P 500 gains sluggish.
“The economy has a great recovery going, but it is not clicking on all cylinders,” stated Edward Moya, senior market analyst at Oanda.
Top S&P 500 Stocks In May 2021
| Company | Symbol | May % Gain | Sector | Composite Rating |
|---|---|---|---|---|
| NortonLifeLock | (NLOK) | 28.0% | Information Technology | 85 |
| Ford Motor | (F) | 25.9% | Consumer Discretionary | 77 |
| Nucor | (NUE) | 24.7% | Materials | 99 |
| Baker Hughes | (BKR) | 21.5% | Energy | 67 |
| Centene | (CNC) | 19.2% | Health Care | 87 |
Sources: IBD, S&P Global Market Intelligence
S&P 500’s Solid 2021 Continues
Massive May features are particularly spectacular because the S&P 500 itself put up its lowest month-to-month achieve since January.
The S&P 500 inched up simply 0.5% in May. But the common’s ho-hum month — largely as a result of lackluster showings by big-cap tech and tech-related shares that dominate the S&P 500 — masks some significantly better efficiency by different particular person shares. The common S&P 500 inventory through the month is up 1.8%.
But every month continues to current highly effective money-making alternatives contained in the S&P 500. And May isn’t any exception in what’s been a string of month-to-month features since January.
Hindsight is 20/20. And clearly, few if any buyers might have pulled this off as it isn’t a repeatable strategy. But the staggering numbers are a reminder to buyers that features could be huge much more than a yr right into a bull market with continued market leadership. And that is even the case as momentum continues to shift into extra “value” oriented elements of the S&P 500.
The Rise Of S&P 500 Cyclical Stocks
Ford is a sizzling S&P 500 inventory?
Ford is only one instance of the rise of stocks tied directly to the ups and downs of the economy. And Ford jumped greater than 25% in May, hitting its highest degree in years. Ford is the top-performing S&P 500 inventory in May. It’s a exceptional turnabout, with the legacy automaker’s shares outperforming the “disruptor,” Tesla (TSLA). Shares of Tesla sank greater than 11% in May, the fifth-worst exhibiting of any S&P 500 inventory. Should you buy Ford or Tesla stock now?
But Ford is much from the one cyclical play dominating in May. Steelmaker Nucor jumped 24.7% in May. Investors are bullish that the economic system’s reopening and large U.S. spending plans on infrastructure will jump-start metal demand. Analysts suppose Nucor’s revenue will soar greater than 180% this yr to $12.56 a share. And income is predicted to leap greater than 48% to $29.9 billion in 2021.
NortonLifeLock Caps Off A Powerful S&P 500 Run
That’s to not say S&P 500 tech shares are utterly out of the image. It’s simply that smaller, less-known tech stocks are putting up the biggest gains.
NortonLifeLock, an organization that sells companies to guard customers’ computer systems and identities, is the No. 1 high performing S&P 500 inventory in May. It jumped 28% within the month of May. Analysts suppose NortonLifeLock’s adjusted revenue per share will soar almost 19% this yr.
And it stood out as many big expertise shares languished through the month. The Technology Select Sector SPDR FUND (XLK) fell 2.3% throughout May. That’s the second-worst exhibiting of any of the 11 sectors.
And once you take a look at the 5 shares that did greatest in every month this yr, only one is within the expertise sector. And it isn’t a family identify, like Apple (AAPL). But that does not appear to matter for S&P 500 buyers who know how to find the new leaders.
Top Current S&P 500 Stocks Each Month In 2021
Being in the proper inventory every month turned $10,000 into $45,906
| Month | Top S&P 500 Stock | Symbol | Stock Monthly % Gain | Sector | S&P 500 % Monthly Ch. | Beg. Bal. | Cumulative Value Of $10,000 Investment In January Reinvested In Top Stock Each Month | Composite Rating |
|---|---|---|---|---|---|---|---|---|
| January | Discovery, Inc. | (DISCA) | 37.7% | Communication Services | -1.1% | $10,000 | $13,770 | 32 |
| February | Marathon Oil Corporation | (MRO) | 53.3% | Energy | 2.6% | $13,770 | $21,109 | 54 |
| March | Nucor | (NUE) | 34.2% | Materials | 4.2% | $21,109 | $28,329 | 99 |
| April | Equifax | (EFX) | 26.6% | Industrials | 5.3% | $28,329 | $35,864 | 97 |
| May | NortonLifeLock | (NLOK) | 28.0% | Information Technology | 0.5% | $35,864 | $45,06 | 82 |
Sources: IBD, S&P Global Market Intelligence
Follow Matt Krantz on Twitter @mattkrantz
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