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Market Participants Reaffirm S&P 500's Ascent in 2025: 5 Picks
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Key Takeaways
The broad-market index recovered nearly 20% in losses and is now hovering around its February all-time high.
APH, JBL, NEM, KLAC and LRCX gained more than 20% in the past three months amid severe volatility.
Improved earnings estimates and macroeconomic scenario support continued upside for these five picks.
The S&P 500 Index has been able to recoup all losses suffered due to the Trump administration’s tariff-led market mayhem at jet speed. Wall Street’s most observed stock index recovered all losses since April 2 and is currently is hovering around its all-time high recorded in February.
During the tariff-led April turmoil, at one point, the S&P 500 was down nearly 20% from its all-time high and on the verge of entering the bear market. Nevertheless, year to date, the index is up 4.6%.
At this stage, we recommend five stocks from the S&P 500 Index for near-term investment. These stocks have provided more than 20% returns in the past three months despite facing severe volatility. These stocks carry a favorable Zacks Rank, which indicates that recent momentum in stock prices will continue in the near term.
Since the beginning of 2025, market participants were bullish on the S&P 500’s northbound journey after astonishing rallies in 2024 and 2023. More than 20 investment management behemoths raised the year-end target level of Wall Street’s most observed stock index.
However, during the tariff and trade-led turmoil in April, 11 major investment banks cut the broad-market index’s target level. However, in the second half of June, eight out of those 11 firms again raised their 2025 target level for the S&P 500 Index.
Expectations of a U.S.-China trade deal, a President Trump-dictated ceasefire between Iran and Israel, a reduction in crude oil and U.S. dollar index prices, a gradual decline in the inflation rate and the evaporation of a near-term recession, boosted market participants’ confidence in risky assets like equities. Consequently, the S&P 500 Index regained its northward trajectory.
The chart below shows the price performance of our five picks in the past three months.
Image Source: Zacks Investment Research
Amphenol Corp.
Zacks Rank #2 Amphenol provides connectivity solutions using AI and ML (machine learning) technologies. It provides AI-powered high-density, high-speed connectors and cables, and interconnect systems optimized for signal integrity and thermal performance.
Amphenol benefits from a diversified business model. APH’s strong portfolio of solutions, including high-technology interconnect products, is a key catalyst. Increased spending on both current and next-generation defense technologies bodes well for APH’s top-line growth. Apart from Defense, APH’s prospects ride on strong demand for its solutions across the Commercial Air, Industrial and Mobile devices.
The Andrew acquisition is expected to add roughly $0.09 to earnings in 2025. APH’s diversified business model lowers the volatility of individual end markets and geographies. Its strong cash-flow-generating ability is noteworthy.
Amphenol has an expected revenue and earnings growth rate of 32.3% and 41.8%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.9% in the last 60 days.
Jabil Inc.
Zacks Rank #1 Jabil has been benefiting immensely from healthy momentum in the capital equipment, AI-powered data center infrastructure, cloud, and digital commerce business verticals. Its focus on end-market and product diversification is a key catalyst. Jabil’s target that “no product or product family should be greater than 5% operating income or cash flows in any fiscal year” is commendable.
JBL’s high free cash flow indicates efficient financial management practices, optimum utilization of assets, and improved operational efficiency. Massive application of generative AI is set to drastically increase the efficiency of JBL’s automated optical inspection machines for automation industry. A large-scale portfolio of business sectors offers JBL a high degree of resiliency during times of macroeconomic and geopolitical disruption.
Jabil has an expected revenue and earnings growth rate of 0.6% and 10.3%, respectively, for the current year (ending August 2025). The Zacks Consensus Estimate for current-year earnings has improved 2.5% in the last seven days.
Newmont Corp.
Zacks Rank #1 Newmont is making notable progress with its growth projects. NEM is likely to gain from several projects, including the Tanami expansion. The acquisition of Newcrest also created an industry-leading portfolio providing opportunities for significant synergies. Moreover, NEM remains focused on improving operational efficiency and returning value to its shareholders.
Newmont has received full funds approval for its Ahafo North project, which has reached the execution stage. Commercial production for the project is expected to commence in second-half 2025. NEM remains committed to Ghana, investing $950 million to $1,050 million in development capital for Ahafo North.
Newmont has an expected revenue and earnings growth rate of 2% and 24.1%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 3.3% over the last seven days.
KLA Corp.
Zacks Rank #2 KLA benefits from strong demand in leading-edge logic, high-bandwidth memory, and advanced packaging, which are driving growth in the semiconductor industry. Advanced packaging is expected to exceed $850 million in 2025.
KLAC’s robust portfolio and its leadership in process control systems are enabling customers to manage increasing design complexity. The services business also continues to perform well. KLAC is well-positioned to capitalize on AI advancements, with AI driving demand for higher-value wafer processing and more complex designs.
KLAC has an expected revenue and earnings growth rate of 2.5% and 1.8%, respectively, for the next year (June 2026). The Zacks Consensus Estimate for next-year earnings has improved 0.8% in the last 30 days.
Lam Research Corp.
Zacks Rank #2 Lam Research is riding on its strength across 3D DRAM and advanced packaging technologies. Growing etch and deposition intensity owing to increasing technology inflections in 3D architectures is a plus. A rebound in the System business owing to improving memory spending is a positive for LRCX.
Strategic investments in research and development activities position LRCX well to capitalize on the growing wafer fab equipment (WFE) spending. For 2025, WFE is expected to be approximately $100 billion. Foundry/logic, DRAM and NAND investments are expected to be higher year over year. Solid demand related to LRCX’s high-bandwidth memory is another driver.
Lam Research has an expected revenue and earnings growth rate of 1.8% and -0.5%, respectively, for the next year (June 2026). The Zacks Consensus Estimate for next-year earnings has improved 0.8% in the last 30 days.
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Market Participants Reaffirm S&P 500's Ascent in 2025: 5 Picks
Key Takeaways
The S&P 500 Index has been able to recoup all losses suffered due to the Trump administration’s tariff-led market mayhem at jet speed. Wall Street’s most observed stock index recovered all losses since April 2 and is currently is hovering around its all-time high recorded in February.
During the tariff-led April turmoil, at one point, the S&P 500 was down nearly 20% from its all-time high and on the verge of entering the bear market. Nevertheless, year to date, the index is up 4.6%.
At this stage, we recommend five stocks from the S&P 500 Index for near-term investment. These stocks have provided more than 20% returns in the past three months despite facing severe volatility. These stocks carry a favorable Zacks Rank, which indicates that recent momentum in stock prices will continue in the near term.
The stocks are: Amphenol Corp. (APH - Free Report) , Jabil Inc. (JBL - Free Report) , Newmont Corp. (NEM - Free Report) , KLA Corp. (KLAC - Free Report) and Lam Research Corp. (LRCX - Free Report) . Each of our picks carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
S&P 500 Regains Investors’ Mojo
Since the beginning of 2025, market participants were bullish on the S&P 500’s northbound journey after astonishing rallies in 2024 and 2023. More than 20 investment management behemoths raised the year-end target level of Wall Street’s most observed stock index.
However, during the tariff and trade-led turmoil in April, 11 major investment banks cut the broad-market index’s target level. However, in the second half of June, eight out of those 11 firms again raised their 2025 target level for the S&P 500 Index.
Expectations of a U.S.-China trade deal, a President Trump-dictated ceasefire between Iran and Israel, a reduction in crude oil and U.S. dollar index prices, a gradual decline in the inflation rate and the evaporation of a near-term recession, boosted market participants’ confidence in risky assets like equities. Consequently, the S&P 500 Index regained its northward trajectory.
The chart below shows the price performance of our five picks in the past three months.
Image Source: Zacks Investment Research
Amphenol Corp.
Zacks Rank #2 Amphenol provides connectivity solutions using AI and ML (machine learning) technologies. It provides AI-powered high-density, high-speed connectors and cables, and interconnect systems optimized for signal integrity and thermal performance.
Amphenol benefits from a diversified business model. APH’s strong portfolio of solutions, including high-technology interconnect products, is a key catalyst. Increased spending on both current and next-generation defense technologies bodes well for APH’s top-line growth. Apart from Defense, APH’s prospects ride on strong demand for its solutions across the Commercial Air, Industrial and Mobile devices.
The Andrew acquisition is expected to add roughly $0.09 to earnings in 2025. APH’s diversified business model lowers the volatility of individual end markets and geographies. Its strong cash-flow-generating ability is noteworthy.
Amphenol has an expected revenue and earnings growth rate of 32.3% and 41.8%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.9% in the last 60 days.
Jabil Inc.
Zacks Rank #1 Jabil has been benefiting immensely from healthy momentum in the capital equipment, AI-powered data center infrastructure, cloud, and digital commerce business verticals. Its focus on end-market and product diversification is a key catalyst. Jabil’s target that “no product or product family should be greater than 5% operating income or cash flows in any fiscal year” is commendable.
JBL’s high free cash flow indicates efficient financial management practices, optimum utilization of assets, and improved operational efficiency. Massive application of generative AI is set to drastically increase the efficiency of JBL’s automated optical inspection machines for automation industry. A large-scale portfolio of business sectors offers JBL a high degree of resiliency during times of macroeconomic and geopolitical disruption.
Jabil has an expected revenue and earnings growth rate of 0.6% and 10.3%, respectively, for the current year (ending August 2025). The Zacks Consensus Estimate for current-year earnings has improved 2.5% in the last seven days.
Newmont Corp.
Zacks Rank #1 Newmont is making notable progress with its growth projects. NEM is likely to gain from several projects, including the Tanami expansion. The acquisition of Newcrest also created an industry-leading portfolio providing opportunities for significant synergies. Moreover, NEM remains focused on improving operational efficiency and returning value to its shareholders.
Newmont has received full funds approval for its Ahafo North project, which has reached the execution stage. Commercial production for the project is expected to commence in second-half 2025. NEM remains committed to Ghana, investing $950 million to $1,050 million in development capital for Ahafo North.
Newmont has an expected revenue and earnings growth rate of 2% and 24.1%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 3.3% over the last seven days.
KLA Corp.
Zacks Rank #2 KLA benefits from strong demand in leading-edge logic, high-bandwidth memory, and advanced packaging, which are driving growth in the semiconductor industry. Advanced packaging is expected to exceed $850 million in 2025.
KLAC’s robust portfolio and its leadership in process control systems are enabling customers to manage increasing design complexity. The services business also continues to perform well. KLAC is well-positioned to capitalize on AI advancements, with AI driving demand for higher-value wafer processing and more complex designs.
KLAC has an expected revenue and earnings growth rate of 2.5% and 1.8%, respectively, for the next year (June 2026). The Zacks Consensus Estimate for next-year earnings has improved 0.8% in the last 30 days.
Lam Research Corp.
Zacks Rank #2 Lam Research is riding on its strength across 3D DRAM and advanced packaging technologies. Growing etch and deposition intensity owing to increasing technology inflections in 3D architectures is a plus. A rebound in the System business owing to improving memory spending is a positive for LRCX.
Strategic investments in research and development activities position LRCX well to capitalize on the growing wafer fab equipment (WFE) spending. For 2025, WFE is expected to be approximately $100 billion. Foundry/logic, DRAM and NAND investments are expected to be higher year over year. Solid demand related to LRCX’s high-bandwidth memory is another driver.
Lam Research has an expected revenue and earnings growth rate of 1.8% and -0.5%, respectively, for the next year (June 2026). The Zacks Consensus Estimate for next-year earnings has improved 0.8% in the last 30 days.