The S&P 500 Index has delivered a strong performance in 2025 as it has climbed over 7% and reached new all-time highs. Despite the good run, investor sentiment remains mixed, with ongoing debates around valuations, inflation, and policy risk.
Chris Harvey, Head of Equity Strategy at Wells Fargo Securities, remains constructive on U.S. equities. Speaking with CNBC on June 12, he projected a 16% upside for the S&P 500 by year-end. While acknowledging persistent risks, Harvey argued that the market has largely absorbed the most disruptive effects of tariffs. He also thinks that encouraging indicators such as tighter credit spreads, a rebound in IPO and M&A activity, and upcoming regulatory shifts as signs that the broader environment remains supportive of further gains.
On inflation, Harvey highlighted the role of mortgage rates in restoring affordability. A meaningful decline in rates, he said, hinges on reduced rate volatility, something that could be achieved with clearer guidance from the Federal Reserve. He also noted that stronger fiscal discipline could have helped improve the outlook, calling policymakers’ inaction on the federal deficit a missed opportunity.
Harvey also argued that comparisons to the late 1990s are overstated. Unlike that period, he noted, today’s dominant technology firms are funding their growth through internal cash flows rather than debt. This, in his view, makes the current cycle more stable and fundamentally sound.
A similar tone was echoed by Lori Calvasina, Head of U.S. Equity Strategy at RBC Capital Markets, during a July 14 interview with CNBC. Calvasina offered an updated view on equity markets and explained RBC’s revised S&P 500 targets. The firm began the year with a 6,600 target but cut it to 5,550 in April following a sharp correction. As the market rebounded more quickly than expected, RBC raised its forecast to 5,750 in early June and again to 6,250 more recently, reflecting stronger-than-expected momentum off the lows.
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She noted that the recovery from the April pullback has been unusually swift, accomplishing in three months what typically unfolds over nine. According to Calvasina, investor attention is now shifting toward 2026 earnings, implying that much of the expected economic and inflation-related drag may already be reflected in current prices.
Valuation remains a central concern for RBC as well. While the top 10 stocks in the S&P 500 are trading at or near peak multiples, valuations across the rest of the index appear more balanced. Calvasina also pointed out that small caps, particularly those in the Russell 2000, hit valuation levels in April typically associated with recessions. Although this has led to renewed interest in the space, small caps have yet to show sustained outperformance relative to large caps.
With these insights in mind, let’s explore the 10 most oversold S&P 500 stocks so far in 2025.
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Our Methodology
To identify the most oversold S&P 500 stocks, we began by screening for companies within the index that have posted significant year-to-date (YTD) share price declines. From this initial pool, we selected 10 stocks with the steepest YTD losses and ranked them in descending order based on their performance. We also added the number of hedge fund holders for each stock, based on the hedge fund sentiment data as of Q1 2025 from Insider Monkey’s database.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Note: All pricing and analyst rating data are as of market close on July 11, 2025.
10 Most Oversold S&P 500 Stocks So Far in 2025
10. Global Payments Inc. (NYSE:GPN)
Year-to-Date Performance: -29.7%
Number of Hedge Fund Holders: 65
Global Payments Inc. (NYSE:GPN) ranks lowest on our list of the most oversold S&P 500 stocks so far in 2025, with a 30% correction so far this year.
On June 2, Truist Securities analyst Matthew Coad initiated coverage of Global Payments with a Hold rating and a price target of $79. Although the stock looks undervalued compared to peers, and management is making efforts to streamline operations, he remains reserved about its growth potential. He expects organic revenue to stay within the 4%–5% range, which may limit the scope for a significant re-rating in the short term.
Coad also points out that investor sentiment could stay subdued until there is greater clarity around the pending asset exchange between Global Payments and Fidelity National Information Services (FIS). The proposed deal involves FIS acquiring Global Payments’ Issuer Solutions (Tsys) business for an enterprise value of $13.5 billion, netting approximately $12 billion for GPN after adjusting for $1.5 billion in expected tax benefits. In return, Global Payments will reacquire FIS’s minority stake in Worldpay for $6.6 billion in pre-tax value. The transaction could reshape the company’s strategic direction and financial profile once completed.
Until then, Coad suggests that more attractive investment opportunities may exist among other large-cap names under his coverage.
Global Payments is a U.S.-based financial technology company that offers payment solutions and related services to businesses, financial institutions, and consumers globally.
9. Conagra Brands Inc. (NYSE:CAG)
Year-to-Date Performance: -30.1%
Number of Hedge Fund Holders: 39
Conagra Brands Inc. (NYSE:CAG) is one of the most oversold S&P 500 stocks so far in 2025. The stock has declined around 30%–32% both YTD and over the past year, largely reflecting broader consumer weakness and persistent inflation, which continue to cloud the outlook for packaged food companies.
Investor sentiment took a further hit following the company’s Q4 FY 2025 results (fiscal year ended May), released on July 10. The numbers confirmed ongoing softness: net sales dropped 4.3% year-over-year, with organic sales falling 3.5%. While lower volumes were the primary driver of this decline, unfavorable price/mix also played a part.
Margins came under pressure, too. Adjusted operating margin contracted by 100 basis points to 13.8%, contributing to an 8% year-over-year decline in earnings per share, which came in at $0.56.
Reacting to the results, RBC Capital’s Nik Modi lowered Conagra’s price target from $25 to $22, maintaining a Sector Perform rating. In his note to clients, Modi acknowledged the firm’s Q4 miss and called attention to a cautious FY 2026 outlook, shaped by ongoing cost inflation and the impact of tariffs.
Interestingly, Conagra appears to be leaning into the downturn by continuing to invest in its brands, improving supply chain flexibility, and supporting volume recovery, despite the near-term strain this puts on margins and sentiment. According to Modi, these investments are critical for rebuilding momentum, even if they come at a short-term cost.
The market may remain cautious in the near term, but it may stabilize and recover depending on how effectively Conagra navigates these headwinds and how soon its investments begin to yield results.
Conagra Brands Inc. (NYSE:CAG) is one of North America’s leading branded food companies with a portfolio that includes brands such as Birds Eye, Duncan Hines, Healthy Choice, Marie Callender’s, Reddi-wip, and Slim Jim.
8. West Pharmaceutical Services Inc. (NYSE:WST)
Year-to-Date Performance: -30.6%
Number of Hedge Fund Holders: 40
West Pharmaceutical Services Inc. (NYSE:WST) is one of the most oversold S&P 500 stocks so far in 2025. On June 24, Barclays analyst Luke Sergott began coverage on West Pharmaceutical Services (WST) with an Equal Weight rating and a price target of $245. In his view, while the company maintains a solid foothold in its core High-Value Products (HVP) segment, recent performance has been weighed down by challenges in its smaller, non-core areas.
Specifically, Sergott points to issues in SmartDose and continuous glucose monitoring (CGM) manufacturing, which have had a disproportionate impact despite their relatively small size compared to the overall business. These segments have faced operational and growth hurdles, which have dragged on sentiment, even though they don’t represent West’s primary revenue drivers.
What stands out more, however, is the longer-term risk highlighted by the analyst: the potential disruption that could be posed by the development of oral GLP-1 treatments. As GLP-1 therapies shift toward oral formulations, the demand for some of West’s injectable delivery systems could face pressure. Sergott flags this trend as a key factor to watch, given the strategic implications it may have for the company’s core product lines over time.
If we talk about future growth, the company views the HVP segment as a key driver, as it contributes approximately 60% of revenue and over 75% of gross profit. Between the various businesses in this segment, revenue is expected to rise by mid-single digits to high single digits over the long term.
West Pharmaceutical Services Inc. (NYSE:WST) delivers value-added solutions throughout the drug development and delivery process. The company specializes in the development and manufacturing of injectable drug delivery systems, high-performance packaging components, and the development of innovative delivery technologies. It also offers contract laboratory and analytical services to support pharmaceutical and biotech partners worldwide.
7. PG&E Corp (NYSE:PCG)
Year-to-Date Performance: -33.5%
Number of Hedge Fund Holders: 76
PG&E Corp (NYSE:PCG) is one of the most oversold S&P 500 stocks so far in 2025. After a relatively better performance in 2024, PG&E stock has been a laggard in 2025 with declines of over 33%, and is now trading near the bottom of its 52-week range.
A major part of this correction occurred in June, when the shares nosedived by around 20%. Investors became increasingly cautious after several reform proposals were advanced, including regulatory changes as part of the California utility regulation overhaul bill. Investors were already digesting the company’s May announcement of its plan to keep rates flat for the next few years. While management stated that utility bills won’t rise in 2025 and will fall in 2026, consumers appeared to remain sceptical, as the company has already raised rates multiple times in 2024.
Driven by regulatory uncertainty, analyst opinions on the shares remained mixed. In mid-May, Morgan Stanley analyst David Arcaro had cut his price target on PG&E Corp (NYSE:PCG) to $18 from $18.5. While utilities continue to see good demand from both data centers and large load customers, the analyst maintained his Underperform rating. More recently, in mid-June, Bank of America Securities analyst Ross Fowler maintained a Buy rating with a price target of $24.
PG&E Corp (NYSE:PCG) provides electric and natural gas distribution services, as well as electric generation and natural gas transmission and storage services, through its subsidiaries. PG&E serves retail customers for both electric and natural gas in northern and central California.
6. Edison International (NYSE:EIX)
Year-to-Date Performance: -36.1%
Number of Hedge Fund Holders: 44
Edison International (NYSE:EIX) is one of the most oversold S&P 500 stocks so far in 2025. On July 8, UBS analyst Gregg Orrill reiterated his Buy rating on Edison International, keeping the price target steady at $68. His near-term caution stems from the delayed outcome of the California general rate case (GRC), which he sees as the key reason behind the weaker earnings expectations for Q2 2025.
Orrill projects Q2 EPS at $0.86, well below the Street consensus of $1.47. However, he has not changed his full-year EPS estimate of $6.00, suggesting that the earnings impact from the rate case will be recognized retroactively from the start of the year once a decision is finalized.
In his view, the lack of clarity on the rate case timing has created some near-term noise, but doesn’t affect the broader earnings trajectory for 2025. He expects a proposed decision to be made in the third quarter, with a final ruling likely to be issued before the end of the year.
Edison International (NYSE:EIX), through its subsidiaries, generates and distributes electric power, as well as provides energy services and technologies, including renewable energy.
5. Lululemon Athletica Inc. (NASDAQ:LULU)
Year-to-Date Performance: -38.2%
Number of Hedge Fund Holders: 48
Lululemon Athletica Inc. (NASDAQ:LULU) is one of the most oversold S&P 500 stocks so far in 2025. In a note published on July 2, Jefferies analyst Randal Konik shared his findings after visiting several key retail locations, including Roosevelt Field Mall, Walt Whitman Shops, and Woodbury Common Outlets, just ahead of the July 4th weekend. According to him, foot traffic appeared noticeably weaker across these sites.
Konik sees growing headwinds for Lululemon (LULU), citing increased markdowns, softer store traffic, and intensifying competition. He also points out that the company’s inventory is rising faster than its sales, which raises concerns about demand sustainability. In his view, the current strategy of expanding retail and outlet locations is doing little to support growth and may actually be working against the brand, contributing to margin pressure from rising rent costs and weakening brand perception.
Despite the company’s recent efforts, the analyst maintains a cautious stance. He continues to expect a decline in both U.S. sales and earnings per share in 2025. Reflecting this view, Konik reiterated his Underperform rating and lowered his price target on the stock to $175 from $200.
Lululemon Athletica Inc. (NASDAQ:LULU) designs and retails athletic apparel, footwear, and accessories for yoga, running, training, and most other activities.
4. Enphase Energy Inc. (NASDAQ:ENPH)
Year-to-Date Performance: -39.1%
Number of Hedge Fund Holders: 40
Enphase Energy Inc. (NASDAQ:ENPH) is one of the most oversold S&P 500 stocks so far in 2025. The bad phase for Enphase appears to have continued this year as well, following a nearly 50% decline in 2024. Reasons for the underwhelming performance have ranged from weaker demand for its solar solutions, falling operating margins, and the impact of tariffs on earnings.
The weakness may continue in the near term, particularly in light of a two-notch downgrade by Goldman Sachs. On July 8, Goldman Sachs analyst Brian Lee downgraded Enphase Energy from a Buy to a Sell rating, while sharply reducing the price target to $32 from $77. The downgrade came as part of a broader reassessment of the residential solar sector following recent policy changes included in the latest budget bill.
In his note, Lee highlighted that the new policy direction is likely to put significant pressure on residential solar demand over both the near and long term. He points to the upcoming expiration of individual tax credits starting in 2026 as an early headwind. However, the bigger concern, in his view, lies beyond 2028, when the market will be forced to adjust to a post-incentive environment—one where residential solar must compete without the support of tax benefits.
Given these shifts, Goldman is revisiting its entire residential solar outlook, and Enphase, as a key player in the segment, faces heightened downside risk under this new policy and market backdrop.
In an update on July 1, a Wells Fargo analyst commented on the revised Senate tax bill recently released, highlighting important implications for Enphase Energy. You can read our update on this report by Wells Fargo, which highlighted Enphase Energy as one of the 10 best sustainability stocks to buy now.
Enphase Energy Inc. (NASDAQ:ENPH) is a global energy technology company specializing in microinverter-based solar and battery storage systems.
3. UnitedHealth Group Inc. (NYSE:UNH)
Year-to-Date Performance: -39.9%
Number of Hedge Fund Holders: 139
UnitedHealth Group Inc. (NYSE:UNH) is one of the most oversold S&P 500 stocks so far in 2025. While the stock was down only marginally in 2024, it has declined substantially in 2025, placing it among the top three oversold stocks. The downturn primarily began with a weak quarterly result and a revision of guidance in April 2025, and was further exacerbated by the CEO’s stepping down and the suspension of guidance in May.
As the company approaches its Q2 2025 earnings results, guidance, and management’s growth plan have come under renewed scrutiny. On July 9, Barclays analyst Andrew Mok revised his price target on the company, lowering it from $350 to $337 ahead of the company’s Q2 earnings release scheduled for July 29. Despite the adjustment, he maintained a Buy rating on the stock.
The lower target reflects a reduction in Mok’s earnings per share forecast for 2026. While he hasn’t changed his positive view on the company’s long-term potential, the revision suggests a more cautious stance on its earnings outlook over the next couple of years.
In a similar move, Wolfe Research analyst Justin Lake had also lowered his price target for the shares to $330 from $363, while reiterating his Buy rating on July 10. Lake now pencils in a lower EPS due to headwinds in Medicaid and health insurance exchanges, as well as higher expenses to bring the company on track.
UnitedHealth Group Inc. (NYSE:UNH) is a healthcare company that provides health insurance and healthcare solutions in the U.S. and globally under the UnitedHealthcare and Optum brands.
2. Centene Corp (NYSE:CNC)
Year-to-Date Performance: -48.1%
Number of Hedge Fund Holders: 64
Centene Corp (NYSE:CNC) is one of the most oversold S&P 500 stocks so far in 2025. On July 2, Centene’s share price plunged 40% after the company withdrew its 2025 earnings guidance. Following the data presented by an independent actuarial firm, Wakely, the company anticipated a significant impact on its growth and EPS estimates; consequently, the market reacted negatively.
Analyst activity has been largely negative, with rating downgrades issued by BofA, Morgan Stanley, and Piper Sandler. On July 11, Mizuho analyst Ann Hynes revised her price target on Centene, cutting it significantly from $71 to $40, while maintaining a Neutral rating on the stock. The update comes as part of Mizuho’s Q2 earnings preview for the healthcare sector.
According to Hynes, near-term earnings visibility appears stronger for hospital operators, whereas managed care companies, such as Centene, continue to face pressure from unfavourable cost trends. She points to rising medical costs as a key concern that could weigh on margins and limit upside in the near term.
As part of the research, Mizuho also conducted a survey of 215 physicians. The results, Hynes notes, support a more constructive outlook for hospitals, are largely neutral for clinical laboratories, and lean neutral to negative for the managed care segment.
Centene Corp. (NYSE:CNC) is a healthcare company that provides managed care services primarily through government-sponsored programs, including Medicaid and Medicare.
1. Deckers Outdoor Corp. (NYSE:DECK)
Year-to-Date Performance: -49.9%
Number of Hedge Fund Holders: 63
Deckers Outdoor Corp. (NYSE: DECK) tops the list of the most oversold S&P 500 stocks so far in 2025, with its share price having declined by 50%.
This sharp decline in the share price has prompted some analysts to be cautious. On July 1, Goldman Sachs analyst Brooke Roach initiated coverage of Deckers Outdoor with a Sell rating and a $90 price target. While acknowledging the strength of Deckers’ brand portfolio, Roach takes a more cautious stance in the near term, citing a less favourable risk/reward profile compared to other names in the apparel and accessories space.
The analyst points to increasing competition, especially in the running category, and early signs that brand momentum may be starting to normalize after years of strong growth. Although Deckers has executed well and gained market share through its portfolio of sportswear and footwear products, Roach believes the broader environment is becoming more challenging.
In her view, even continued strong execution may not be enough to offset rising competition and evolving consumer preferences. These factors, she argues, create a more subdued outlook for the industry in the short term.
Deckers Outdoors Corp. (NYSE:DECK) designs, markets, and distributes innovative footwear, apparel, and accessories developed for both everyday casual lifestyle use and high-performance activities.
On the other side, UBS analyst Jay Sole had reiterated a Buy rating on Deckers in early June, maintaining his $169 price target. Please read our update on this UBS report, which was published as part of our list of the 11 best debt-free stocks to invest in right now.
While we acknowledge the potential of DECK as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than DECK and that has 100x upside potential, check out our report about the cheapest AI stock.
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Disclosure: None.
