The Great Rotation: 5 Stocks Set to Win as Money Leaves Megacap Tech

3 weeks ago 17

Joel South

Fri, July 17, 2026 astatine 11:47 AM CDT 7 min read

Quick Read

JPM bushed Q2 EPS estimates by 33% and DVN raised its dividend 31% arsenic wealth rotates from megacap tech into financials and energy.
Megacap tech fell 2% past week portion financials gained 2% and vigor climbed 4%, confirming the rotation is already playing retired successful existent time.
Act now: the expert who called NVIDIA successful 2010 conscionable named his apical 10 AI stocks — and JPMorgan Chase didn't marque the cut. Grab the names FREE today.

The Nasdaq-100 shed 3.28% implicit the past period portion the Russell 2000 gained 1.2% implicit the aforesaid stretch. That is the rotation, successful 1 line, successful existent time. Money is walking retired of megacap tech and into the industrials, financials, vigor names, worth retailers, and brokers positioned to drawback it. Miss the pivot and you are holding past year's leaders portion everyone other prints this year's gains.

An evening wide changeable of an electrical powerfulness substation with ample grey transformers, galore alloy lattice transmission towers, and a web of powerfulness lines against a twilight sky. Several workers wearing hard hats and reflective vests are connected the ungraded ground. A ample crane hook hangs prominently successful the precocious left, and ample spools of cablegram are disposable connected the right.

1. Powell Industries (POWL): The Small-Cap Toll Collector connected the AI Power Grid

Powell Industries (NASDAQ:POWL) is the astonishment sanction connected this database due to the fact that it is the picks-and-shovels play connected the nonstop spending rhythm that megacap tech has been throwing wealth at. Every hyperscaler information halfway needs medium-voltage switchgear, custom-engineered electrical distribution, and on-site power. Powell builds it. When superior rotates from the AI communicative buyers to the AI enablers, this is wherever it lands.

The Q2 FY26 study was a survey successful wherefore the marketplace is mispricing this name. Reported EPS came successful astatine $1.25, missing the $1.34 statement by 6.90%, and shares person pulled backmost 19.44% successful the past month. Look past the miss. New orders surged 97% twelvemonth implicit twelvemonth to $490 million, backlog deed $1.80 cardinal with a 1.7x book-to-bill, and post-quarter Powell landed a information halfway bid successful excess of $400 million, the largest successful institution history. CEO Brett Cope tied it straight to the "ongoing concern rhythm to enactment information halfway physique outs and AI capableness growth."

Act now: the expert who called NVIDIA successful 2010 conscionable named his apical 10 AI stocks — and JPMorgan Chase didn't marque the cut. Grab the names FREE today.

The EPS miss triggered a pullback successful a banal that is inactive up 122.08% twelvemonth to day and 226.01% implicit the past year. The backlog says the communicative is conscionable starting to compound. And speaking of compounding, the adjacent sanction has been softly stacking postulation gains portion premium retail bleeds.

2. TJX Companies (TJX): Traffic Is Rotating, Not Just Dollars

TJX Companies (NYSE:TJX) sits straight nether the wealth leaving discretionary tech-adjacent user names. When shoppers commercialized down from premium retail, they locomotion into TJ Maxx, Marshalls, and HomeGoods. The rotation shows up arsenic handbasket counts, not terms hikes.

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