The major benchmarks not only recovered all their losses since the start of the war with Iran but also turned positive for the year to date. Even better, rising corporate profit estimates are pulling valuations down from historically rich levels.
The forward price-to-earnings ratio, or P/E ratio, on the S&P 500 currently stands at 20, according to Yardeni Research. That's down from 23.5 before the onset of hostilities. Meanwhile, the index's price-earnings-to-growth (PEG) ratio, which measures how fast a stock is rising relative to its growth prospects, has fallen to less than 1.1. Prior to the war, it stood at nearly 1.5.
Not too long ago, finding outsized gains in Wall Street's top S&P 500 stocks was a challenge. But with equities rebounding amid more attractive valuations, a long list of index names appear poised for serious outperformance.
True, uncertainty abounds. Geopolitical instability has global markets on edge. Perhaps most troubling, higher energy prices are fueling inflation, and that's putting the Federal Reserve in a tight spot. Markets were expecting two cuts to the short-term federal funds rate at the beginning of 2026. Now, they're not so sure.
According to the Fed's Summary of Economic Projections (pdf), forecasts from 19 Federal Reserve officials show that seven see no cuts at all in 2026, seven see one cut, and five see two or more.
The consensus on Wall Street is that we'll get just one cut this year, and it won't come until September.
Nevertheless, estimates for operating earnings, also known as mother's milk for stocks, continue to march higher. The technical picture is increasingly constructive, as well.
"We believe the lows very likely are in and a surprise move higher is probably coming," writes Ryan Detrick, chief market strategist at Carson Group. "We are fully aware with the war in Iran this could always change, but we still think this is a bull market and with new highs not all that far away."
The bottom line is that although markets may be a bit choppy, the fundamental outlook for equities remains bright.
Analysts spy lots of big bargains
As long as a company's earnings prospects are rising faster than its share price, its stock can very much look like a bargain, and therefore a potential market beater. To get a sense of where to start digging for such finds, we screened the S&P 500 by implied upside to industry analysts' average price targets.
What we found: 25 stocks in the S&P 500 have implied upside of at least 45% over the next 12 months or so, according to data from S&P Global Market Intelligence.
But before we get to the S&P 500 stocks that could rally the most based on price targets, a caveat is in order.
Price targets are a blunt tool when it comes to sussing out cheap stocks. Committing capital based on a single data point is not an investment process.
It's also important to note that stocks with the most upside potential don't necessarily get consensus Buy recommendations from the very same analysts whose models spit out the target prices.
With that warning out of the way, if you're looking for widely traded stocks with the most upside potential, the names listed below aren't a bad place to start.
Company (Ticker) |
Price target |
Upside to price target |
Consensus rating score |
Consensus rating |
|---|---|---|---|---|
ServiceNow (NOW) |
$179.26 |
101% |
1.43 |
Strong Buy |
Axon Enterprise (AXON) |
$717.68 |
100% |
1.60 |
Buy |
Fair Isaac (FICO) |
$1,827.86 |
83% |
1.90 |
Buy |
CoStar Group (CSGP) |
$64.00 |
75% |
1.80 |
Buy |
Insulet (PODD) |
$335.26 |
72% |
1.50 |
Buy |
Datadog (DDOG) |
$181.37 |
65% |
1.42 |
Strong Buy |
Intuit (INTU) |
$599.51 |
62% |
1.51 |
Buy |
Gen Digital (GEN) |
$30.01 |
59% |
1.92 |
Buy |
Oracle (ORCL) |
$246.23 |
58% |
1.61 |
Buy |
Boston Scientific (BSX) |
$97.00 |
58% |
1.35 |
Strong Buy |
DoorDash (DASH) |
$252.15 |
58% |
1.60 |
Buy |
Salesforce (CRM) |
$269.98 |
58% |
1.66 |
Buy |
Broadridge Financial Solutions (BR) |
$245.88 |
56% |
2.22 |
Buy |
Applovin (APP) |
$646.86 |
55% |
1.50 |
Buy |
Microsoft (MSFT) |
$585.41 |
52% |
1.28 |
Strong Buy |
EPAM Systems (EPAM) |
$187.24 |
51% |
1.84 |
Buy |
Aptiv (APTV) |
$89.67 |
51% |
1.55 |
Buy |
Workday (WDAY) |
$179.22 |
49% |
1.95 |
Buy |
Vistra (VST) |
$234.26 |
48% |
1.35 |
Strong Buy |
Trade Desk (TTD) |
$31.09 |
47% |
2.26 |
Buy |
Zebra Technologies (ZBRA) |
$328.94 |
45% |
1.78 |
Buy |
Nike (NKE) |
$62.37 |
45% |
2.23 |
Buy |
Autodesk (ADSK) |
$328.88 |
45% |
1.44 |
Strong Buy |
Global Payments (GPN) |
$98.24 |
45% |
2.36 |
Buy |
Robinhood Markets (HOOD) |
$102.94 |
45% |
1.93 |
Buy |
Data as of April 14, courtesy of S&P Global Market Intelligence.
