April is one of the best months of the year for S&P 500 investors. And some stocks keep handing investors big gains during the month.
Ten stocks in the S&P 500 — including Molina Healthcare, SBA Communications and Newmont — topped the index in April in each of the past five years, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. Additionally, all of these stocks rose an average of at least 6% in April going back five years.
Beating the S&P 500 is no small feat, either. April is the second-best month of the year, with an average monthly gain of 1.5% going back to 1950. November, with its average 1.7% gain, is the only month that's better.
"April is the No. 1-performing Dow Jones Industrials Average month of the year since 1950, No. 2 month for S&P 500 and No. 4 for Nasdaq," says Stock Trader's Almanac, which adds, "But stay vigilant."
Sizing Up The S&P 500 In April
Hopes are high for another solid month for the S&P 500 in April.
Shares rose 2.9% in March, helping to reverse the 2.6% drop in February. All told, the S&P 500 is now up 6.4% this year.
And that's where a solid April would come in. Typically, April wraps up the "best six months" of the year, which starts in November, says "Stock Trader's Almanac." Some positive events help propel stocks in April. Usually the April rally kicks off most strongly following the tax deadline. Presumably, tax bills are paid and sometimes refunds become available to invest.
Additionally, investors get their first look at corporate profit for the year as first-quarter results are reported in April. Currently, analysts think S&P 500 earnings will fall 6.6% during the quarter, says John Butters of FactSet. Analysts have slashed their outlooks for the quarter, perhaps making it easier for some S&P 500 companies to top views.
Top S&P 500 Stock In April: Molina Healthcare
Talk about an April winner in the S&P 500. Molina Healthcare, which provides managed care to low-income families, is a champion stock in April.
Molina shares gained nearly 10% just in the month of April, on average, over the past five years. That's a higher April return than any other S&P 500 stock. And it's a surefire winner in April. MOH stock not once dropped in April in the past five years. Even in April 2020, when the S&P 500 plunged 13%, shares of Molina Healthcare added 14%.
Unlike S&P 500 earnings, seen dropping in the first quarter, analysts think Molina's adjusted profit per share will rise more than 6% to $5.20. And the company has the potential to outperform expectations. Last March, the company's adjusted profit per share topped views by nearly 5%.
Other Big April Winners
Molina isn't the only S&P 500 stock that doesn't miss in April. Six of the 10 top-performing stocks in the April have never posted losses in April going back at least five years.
Take SBA Communications, which runs communications networks in the Americas. The stock has gained more than 8.7% during April in the past five years on average. It eked out a nearly 2% gain in March 2020, while most of the rest of the S&P 500 suffered a big loss.
This April, though, could be a test. What are analysts expecting from SBA's first-quarter profit report in April? The company is seen making just $1.20 a share, which would be down more than 30% from a year ago.
However, the company topped analysts' forecast for the quarter ended in March 2022 by more than 70%. And this is just one of the S&P 500 stocks that show how good April can be for investors.
Top S&P 500 Stocks In April
| Company | Ticker | Avg April gain past 5 years | Sector |
|---|---|---|---|
| Molina Healthcare | 9.7% | Health Care | |
| SBA Communications | 8.7% | Real Estate | |
| Newmont | 7.9% | Materials | |
| Digital Realty Trust | 7.0% | Real Estate | |
| American Tower | 6.7% | Real Estate | |
| Akamai Technologies | 6.4% | Information Technology | |
| Equinix | 6.4% | Real Estate | |
| Atmos Energy | 6.1% | Utilities | |
| Consolidated Edison | 6.0% | Utilities |
Sources: S&P Global Market Intelligence, IBD
Follow Matt Krantz on Twitter @mattkrantz
