After a nice rebound in April, the stock market continued to power higher in May. Happily, my Portfolio has come along for the ride!
Earnings season is essentially over at this point, although a few companies are still slated to report in the coming weeks. Corporate earnings were quite strong in the 2nd quarter, with most companies exceeding expectations. Market momentum has been led by tech earnings, specifically AI-related companies. This has been the case despite geopolitical tensions and sticky inflation creating headwinds.
Note – the monthly percentages noted below are through 5/22/26.
Information Technology (13.0%), Energy (5.6%) and Communication Services (5.6%) were the best-performing sectors in May, but only the Info Tech sector outpaced the S&P 500 (5.8%) as a whole. Materials (-2.9%) and Financials (-0.8%) were the lagging sectors in May.
For the year, the Energy sector (31.5%) is still leading other sectors in gains, but Info Tech (18.1%) is trying to present a challenge. The S&P 500 is up 9.2% year-to-date (YTD), or 9.7% if you include reinvested dividends.
Only two sectors are in the red YTD. These include Financials (-5.4%) and Healthcare (-3.4%).
With tech so hot over the past month, my Portfolio is no longer beating the S&P 500 for 2026. However, I only trail by about 0.3% right now.
Lastly, I didn’t have as many of my Top 10 holdings in the green this month (only 6 green to 4 red), but one of the gainers had a massively outstanding month (as you’ll see).
I’ll once again be covering my usual items in this month’s Portfolio Thoughts post…
- Price Movement – I’ll look at my top advancers and decliners in my Portfolio during the past month.
- Top 10 Review – I’ll update my Top 10 Portfolio stocks and how they changed rank this past month.
- Weightings – I’ll examine the sector weightings within my Portfolio and let you know where I’ve made progress with regard to getting into my preferred weighting ranges.
- Watch List – I’ll share which stocks I’m looking at for possible purchase or sale in the event I decide to shuffle up my holdings.
What follows are my Portfolio Thoughts for May 2026…
Price Movement
Note – my price changes cover closing prices from 4/24/26 to 5/22/26.
My individual Portfolio stocks haven’t been overly impressive in May with gains as a group, but they did end up in the green. The gainer/decliner ratio was just about 6:5. Of my 57 holdings, 31 climbed in price, while the other 26 retreated.
Here were the stocks with the biggest moves to the upside and downside…
Of my 31 stocks that rose in price in May, one of them advanced by 60%! Another one popped by more than 35%, and yet another by nearly 30%. Another four stocks recorded a gain north of 10% (the usual threshold I monitor for). Additionally, count seven more stocks that gained at least 5%. The gains varied widely in May.
My top gainers in May were:
- Qualcomm (QCOM), skyrocketing 60.00%
- Cisco Systems (CSCO), soaring 35.28%
- Skyworks Solutions (SWKS), surging 29.49%
- Automatic Data Processing (ADP), rising 14.64%
- Texas Instruments (TXN), climbing 11.57%
The top gainers list sported four technology stocks… wow! And for the 2nd month in a row there were three semiconductor stocks: this time it was QCOM, SWKS & TXN.
TXN was a repeat standout. The stock was my top gainer in April, and managed to keep itself in the Top 10 this month, too.
QCOM surged in May due to an automotive partnership with Stellantis, business growth outside of smartphones, and possible entry into the AI data center chip market.
SWKS popped late in the month and seems to be benefiting from the broader rally in semiconductors. Fiscal Q2 results were good, and Wi-Fi 7 growth showed a nice boost.
CSCO gained after a good fiscal Q3 earnings report. The company is pivoting its business into AI. Its hardware is showing strong orders and looks to be desired as part of the ongoing data center buildouts.
The lone non-tech stock in my top gainers list was ADP. The company’s fundamentals seemed to have stabilized recently. Concerns over AI affecting their business are still present, but may have been overdone. Perhaps ADP’s stock price recovery has begun.
Note – only one sector in my Portfolio had all their holdings in the green this month… Energy (2).
Of my 26 stocks that dropped in price, just two of them fell my more than 10%. However, another four retreated by more than 5%. There certainly weren’t any stocks that moved to the downside as aggressively as those handful that moved up in May.
My worst decliners in May were…
- Intuit (INTU), collapsing 19.20%
- Lowe’s Companies (LOW), tumbling 12.04%
- Meta Platforms (META), falling 9.60%
- Main Street Capital (MAIN), sliding 8.19%
- Nexstar Media Group (NXST), slumping 7.41%
A couple of stocks failed to remove themselves from the top decliners list I had last month. Those stocks were INTU and NXST… repeat offenders. Both INTU and NXST managed to drop even faster in May than they did in April.
Slowing TurboTax growth and some AI-driven restructuring charges hurt INTU during the release of its fiscal Q3 earnings report. The stock price dropped about 20% on the day the earnings were released. This just extended what has been a poor 2026 for INTU.
NXST has investor concern related to the block of its Tegna acquisition by a federal court due to antitrust concerns. In addition, NXST is facing advertising headwinds as local TV ad spending has been transitioning online.
A challenging housing market and tightening consumer spending are putting a dent in the business of LOW. The stock has dropped over 20% since the end of January and is now in the red for the year.
Investors continue to question the capital expenditures of META. The company noted increased spending in its last earnings report. The timing and profitability of their AI-related spending have raised investor doubt. META is trimming about 10% of its workforce to try and ease some of the spending concerns.
The last of my top decliners was MAIN. MAIN missed analyst expectations for revenue and earnings in its quarterly report. Add this to concerns surrounding the private credit market, and increased loan defaults, and the decline in MAIN wasn’t surprising. MAIN has fallen in price for four consecutive months.
Note – no sectors in my Portfolio had all of their holdings in the red this month.
Top 10 Review
I had a decent amount of movement within my Top 10 in May. Six of the ten stocks moved, comprised of three pairs of stocks that swapped places.
Two of the three swaps involved movement of a single spot, while the remaining pair involved movement of two spots.
All the Top 10 stocks this month were part of the Top 10 last month (i.e. no new stocks in the Top 10 in May).
Just six of my Top 10 stocks were in the green this month (a step down from nine last month). Only one of the Top 10 gainers managed a double-digit gain, and that was the massive jump from QCOM.
Broadcom (AVGO) held down the #1 spot yet again, despite posting a 2.04% decline in May. This position is still more than twice as big as any other in my Portfolio.
On the back of its monster 60% gain, Qualcomm (QCOM) jumped two spots to secure the #2 spot.
Holding steady at the #3 spot was Caterpillar (CAT). CAT recorded a 5.91% gain during May, its 2nd straight month of gains.
It was Aflac (AFL) that swapped spots with QCOM. AFL tumbled two spots to fall to #4 even though it managed a 2.83% gain for the month.
AbbVie (ABBV) and Visa (V), held onto the #5 and #6 spots, respectively. The 8.55% gain from ABBV and the 6.29% gain from V were solid.
Climbing one spot to lay claim to the #7 spot was BlackRock (BLK). The stock gained 2.68% to help with the move up.
It was Fastenal (FAST) that swapped spots with BLK. FAST fell one spot to finish at #8. A small decline of 1.68% was enough to cause FAST to slip in the rankings.
Moving up one spot to land at #9 was JPMorgan Chase & Co. (JPM). JPM was able to advance despite its -0.62% decline during May.
It was RPM International (RPM) that swapped spots with JPM. RPM dropped one spot to secure #10, the final spot. The -3.89% decline from RPM wasn’t too horrible, even though it was my worst Top 10 stock performance in May.
Now hovering outside my Top 10 are Johnson & Johnson (JNJ) and Union Pacific (UNP). JNJ needs to make up about $1K in value to crack the Top 10, while UNP needs about $2K more.
From the table above, my Top 10 holdings now comprise 44.47% of my Portfolio value. This is an increase of 0.91 percentage points compared to last month. The 60% gain from QCOM was the primary cause for this jump. Of the Top 10 stocks, there are now three stocks that don’t have at least a 3% weighting: FAST, JPM & RPM.
As for the dividend weighting of my Top 10, it now stands at 26.19%. This is a decrease of 0.13 percentage points compared to last month. The small AVGO trim accounted for some of this decline, but mostly it was the fact that no dividend increases were announced for any of my Top 10 stocks in May, and I didn’t add to any of these positions either.
Weightings
In general, for Sector Diversification, I target being within +/-3 percentage points of the sector weightings of the S&P 500. For SuperSector Diversification, I target being within +/-5 percentage points.
The “Weight Diff.” column shows which sectors sit outside my preferred weighting ranges. If I’m overweight a sector, it’s shaded green. If I’m underweight a sector, it’s shaded red. If I’m within my target weighting range, then no shading exists.
At the end of May, I still have the same number of sectors outside my preferred weighting range… 6. This includes 3 overweight sectors and 3 underweight sectors in my Portfolio. Industrials remains my most overweight sector and Information Technology remains my most underweight sector.
Sadly, I didn’t make any progress when it came to getting closer to my preferred weighting range in any of the 6 sectors… not even in my underweight Information Technology sector where one of my largest holdings (QCOM) gained 60%.
The sector in which I regressed most was once again Communication Services. I went from being -3.93% underweight to being -4.22% underweight… a change of 0.29 percentage points. Price drops from Meta Platforms (META) and Nexstar Media Group (NXST) in May just worsened this sector difference for me.
As for dividend weightings, there was not much change to disclose. The biggest change was in Information Technology, which added 0.29 percentage points, primarily due to my Accenture (ACN) addition during the month. I’ve currently got four sectors each providing more than 12% of my dividend income, and four sectors each providing less than 5%.
As always, I’ll keep all my sector weightings in mind as I continue to adjust my Portfolio, and my watchlist.
Watch List
Since my Portfolio dividends are now used for living expenses (since I’m no longer working), I don’t expect to purchase stocks very often. Yet, I could choose to sell an under-performing stock and invest in a potentially better one. Thus, I plan to keep looking for opportunities and keeping my watchlist up-to-date.
I made a couple of Portfolio transactions in May, so my watchlist came in handy this month. I trimmed Broadcom (AVGO) and added Accenture (ACN). I mentioned both of these moves in last month’s watchlist. I secured my ACN shares well below my target price.
Within my Portfolio, here are a few stocks that I’m watching for possible additions…
Intuit (INTU) continued to fall in May. The stock nearly touched $300 late in the month. Last month, I thought adding a share below $400 was reasonable. I’ll have to determine if I want to build this position or not. If not, I may just realize my loss and move on.
Main Street Capital (MAIN) has been drifting lower with the threat of rising interest rates (among other things). Another dip below $50 could get me to buy. I sold half my position almost 1 year ago over $63 when the stock was looking overvalued.
I’m still watching Medtronic (MDT) this month, as it hovers around $77. This is currently my 8th smallest position and it could afford to get larger.
Adding to Meta Platforms (META) under $600 remains interesting to me. The stock traded in the $600-$620 range for most of May.
Nike (NKE) still trades under $45, but I may hold off for now until there are clearer signs of a turnaround.
PIMCO Corporate & Income Strategy Fund (PCN) trades under $11.70. Its premium to NAV is also as low as it’s been in years. PCN is showing signs of being undervalued to me and buying here would lower my cost basis.
Considering stocks I might sell…
With Skyworks Solutions (SWKS) crossing above $80, I’ve been looking to exit my position. However, the stock is in the red hot semiconductor trade and may have more short-term upside (or not!). Stay tuned.
As mentioned above, I could end up selling Intuit (INTU) if I don’t decide to build out my position.
As for non-Portfolio stocks that I’m watching…
None at this time. I remained focused inside my Portfolio instead, where there’s plenty of optimization to do.
Thoughts?
Do you have any thoughts of re-balancing your Portfolio given the market gains realized over the past 2 1/2 years? Do you think the Federal Reserve will choose to raise interest rates sometime in the next 6 months, or try to hold off on doing so? Please share your thoughts!