3 More of the Hottest Stocks in the S&P 500 Heading Into the New Year
- - 3 More of the Hottest Stocks in the S&P 500 Heading Into the New Year
Matthew Benjamin, The Motley FoolDecember 12, 2025 at 4:57 AM
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Key Points -
Dollar General is expanding and becoming more profitable.
Expedia stock is having a moment due to increased travel demand.
EPAM Systems' turnaround is fueling its price rally.
10 stocks we like better than Dollar General ›
I've identified three more stocks that have seen strong upward price movement over the past month and look very promising heading into 2026.
For investors looking for the hottest S&P 500 stocks going into the new year -- with upside potential over the next 12 months -- these three are among the top 10 recent performers in that index and could be very good additions to portfolios for 2026: Dollar General (NYSE: DG), Expedia Group (NASDAQ: EXPE), and EPAM Systems (NYSE: EPAM).
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Of course, as with all performance metrics, the parameters you set for time frame and other factors matter. Here, I chose to limit my search to the S&P 500 because those 500 large-cap stocks represent about 80% of the total market capitalization of U.S. companies, and they tend to be well-established companies with real revenues and profits, rather than flash-in-the-pan microcaps.
And I went with a one-month performance time frame because it's short enough to show recent upward momentum due to new developments or financial results, but not so short that the price movement could be based on factors that have a high chance of reversing overnight and wiping out all gains.
This discount chain is expanding and becoming more profitable
First up: Dollar General. The discount retailer's share price had been drifting lower since early August until it spiked higher recently. It's up more than 32% over the past month as of Dec. 5.
So, what's happening?
Well, the company reported fsical third-quarter financial results on Dec. 4, and they exceeded expectations. Sales rose 4.6% from a year ago to $10.6 billion. Earnings per share soared 43.8% to $1.28, which was well above Wall Street's estimate of $0.93 a share. And gross profit margin rose 107 basis points to a strong 29.9%, indicating the company is becoming more profitable.
The company also opened 196 new stores and remodeled 1,175 locations during the quarter.
Sale signs in a store aisle.
Image source: Getty Images.
Management now projects earnings per share of $6.30 to $6.50 in 2025, up from a prior forecast of $5.80 to $6.30. Improved guidance is almost always good for a company's share price.
All of those metrics bode very well for Dollar General in the new year.
Rising travel demand continues to lift this stock
Next up is a company that's probably very familiar to most. It's Expedia Group (NASDAQ: EXPE), which runs the travel sites Expedia.com and Hotels.com, as well as Trivago, a global hotel search engine.
The stock has been rising steadily since early April, but it surged in early November after the company announced robust third-quarter results and boosted its full-year revenue forecast. Revenue was up 9% to $4.4 billion in the quarter while gross bookings jumped 12% to almost $31 billion.
Management increased full-year revenue growth guidance to 6%-7%; the previous guidance was 3%-5%. And gross bookings growth for the year is now predicted to be 7%; it was previously 3%-5%.
Management said the latest results are the result of growing travel demand, use of artificial intelligence, and better cost control.
Expedia's share price soared on the financial results and the stock is up almost 23% over the past month as I write this. If travel demand remains robust in the months ahead -- and many forecasts expect it to -- this is a great way to capitalize on it.
This stock is a rebound story related to the Russia-Ukraine conflict
Last up is EPAM Systems (NYSE: EPAM), an IT services firm headquartered in Newtown, Pa. The company traditionally had a lot of workers in Ukraine, Belarus, and Russia, and so the share price collapsed in early 2022 after the Russian invasion of Ukraine.
But EPAM seems finally to be pivoting from war-affected regions, as indicated by recent financial results.
The stock has been rallying since mid-October and is up more than 26% over the past month as I write this. Much of that rebound is the result of a strong third-quarter earnings report: Adjusted earnings per share climbed 14.3% from the year-ago period while revenue grew 1.7%. Both figures beat Wall Street's expectations.
Management also raised full-year revenue guidance to a range of $4.69 billion to $4.7 billion, up from prior guidance of $4.59 billion to $4.63 billion, as well as its adjusted profit outlook for the year to a range between $10.73 and $10.81, up from a prior range between $10.20 and $10.40.
Earnings announcements and upward guidance revisions can do wonders for a stock. As we all know, the share price ultimately follows earnings.
If these companies can sustain their recent momentum -- and it looks to me like they can -- their stocks will be great additions to any portfolio.
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Matthew Benjamin has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends EPAM Systems. The Motley Fool has a disclosure policy.
Source: “AOL Money”
