Wall Street’s high-flying northward journey from January 2023 to January 2025 was predominantly supported by an astonishing rally in the technology sector, buoyed by the explosive growth of generative artificial intelligence (AI). Several AI-centric stocks skyrocketed 400-500% during this period.
As many financial experts and economists expect a near-term recession, investors are gradually booking profits in tech stocks, for which valuations are extremely overstretched. The three major stock indexes — the Dow, the S&P 500 and the Nasdaq Composite — are in negative territory year to date.
The Nasdaq Composite is currently in correction territory, sliding 14% from its recent high. The S&P 500 is also 8.7% below its recent high. An index enters correction territory once it falls below 10% of its recent high. Despite the index’s recent bloodbath, a handful of non-tech Nasdaq Composite listed stocks have provided double-digit returns year to date. At this juncture, investing in these stocks should prove fruitful.
Five such stocks with a favorable Zacks Rank are Exelon Corp. EXC, Gilead Sciences Inc. GILD, Plains All American Pipeline L.P. PAA, Sportradar Group AG SRAD and Cintas Corp. CTAS.
Recession Fear Looms Large
Wall Street’s impressive bull run that started at the beginning of 2023 suffered a blow last month. Thereafter, market participants’ pain has increased manifold. Investors are highly anxious about the impact of the Trump administration’s tariff and trade policies.
Recently released several key economic data have clearly shown that the U.S. economy is weakening. The resilient labor market has shown softness. Last released data for retail sales, industrial production, manufacturing PMI, housing sector data as well as consumer confidence and sentiment indexes came in well below expectations.
Market participants are now highly skeptical about the Fed’s much-hyped “soft landing” of the U.S. economy. The Fed reduced the benchmark lending rate by a significant 1% in 2024. However, Chairman Jerome Powell said the central bank is in no hurry to cut rates further any time soon.
According to Powell, “the time and magnitude of the rate cut will depend on inflation and other key economic data. In addition, this time the rate cut decision will be guided by the Trump administration’s tariffs and trade related policies.” Importantly, in an interview last weekend, President Donald Trump did not rule out of the possibility of a near-term recession in the U.S. economy.
5 Non-Tech Nasdaq Stocks to Buy
We have narrowed our search to five Nasdaq Composite-listed non-tech stocks that have provided double-digit returns year to date. These stocks have strong growth potential for 2025 and have seen positive earnings estimate revisions in the past 60 days. Each of our picks carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The chart below shows the price performance of our five picks year to date.
Zacks Investment Research
Image Source: Zacks Investment Research
Exelon Corp.
Exelon’s investment will strengthen its transmission and distribution infrastructure and assist in providing reliable services to customers. EXC’s initiatives in grid modernization will improve the resilience of its operations, and revenue decoupling will mitigate the impact of load fluctuation. A stable cash flow allows EXC to pay regular dividends. The development of data centers will increase demand.
Exelon has an expected revenue and earnings growth rate of 3.4% and 5.6%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.4% over the past seven days. EXC has a current dividend yield of 3.71%.
Exelon is currently trading at an attractive valuation compared to its peers. The stock has forward price/earnings (P/E) of 16.32X, below the industry’s P/E of 17.95X and the S&P 500’s P/E of 18.58X. It has a price/sale (P/S) of 1.88X, compared with the industry’s P/S of 2.22X and the S&P 500’s P/S of 2.91X. Moreover, it has a price/book (P/B) of 1.61X, compared with the industry’s P/B of 1.51X and the S&P 500’s P/B of 3.53X.
Gilead Sciences Inc.
Gilead Sciences reported better-than-expected fourth-quarter results and provided an upbeat guidance for 2025. GILD’s flagship HIV therapy, Biktarvy, continues to maintain its strong growth, fueling the top line. GILD’s efforts to develop better HIV treatments are commendable. Recent data validate lenacapavir’s potential to prevent HIV.
A potential approval of lenacapavir should be a significant boost for Gilead. Our sales estimates for Biktarvy indicate a CAGR of around 4.5% over the next three years. GILD’s efforts to bolster its oncology and virology franchises through internal pipeline development and collaborations are impressive as well.
Gilead Sciences has an expected revenue and earnings growth rate of -0.7% and 70.4%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.1% over the past seven days. GILD has a current dividend yield of 2.62%.
Gilead Sciences is currently trading at an impressive valuation. The stock has forward P/E of 14.92X, below the industry’s P/E of 19.23X and the S&P 500’s P/E of 18.58X. It has a P/S of 5.09X, compared with the industry’s P/S of 5.73X and the S&P 500’s P/S of 2.91X. Moreover, GILD currently has a return on Equity (ROE) of 31.63%, compared with the industry’s ROE of -62.66% and the S&P 500’s ROE of 17.11%.
Plains All American Pipeline L.P.
Plains All American Pipeline Plains All American Pipelines’ widespread Permian Basin operations should allow it to capture the increasing Permian production volumes. PAA’s cost-saving initiatives, joint venture and asset divestitures are expected to boost operations.
PAA’s expansion of existing pipelines and development of new pipeline projects in key production regions of the United States should drive its operations. PAA has enough liquidity to meet its near-term debt obligations.
Plains All American Pipeline has an expected revenue and earnings growth rate of 2.7% and 1.3%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2% over the past 30 days. PAA has a current dividend yield of 7.86%.
Plains All American Pipeline is currently trading at a solid valuation. The stock has forward P/E of 12.66X, compared with the industry’s P/E of 11.98X and the S&P 500’s P/E of 18.58X. It has a P/S of 0.27X, compared with the industry’s P/S of 1.12X and the S&P 500’s P/S of 2.91X. Moreover, It has a P/B of 1.26X, compared with the industry’s P/B of 1.42X and the S&P 500’s P/B of 3.53X.
Sportradar Group AG
Sportradar Group provides sports data services for the sports betting and media industries in the United Kingdom, the United States, Malta, Switzerland, and internationally. SRAD offers sports data services to the bookmaking under the Betradar brand name, and to the international media industry under the Sportradar Media Services brand name. SRAD offers mission-critical software, data, and content to sports leagues and federations, betting operators, and media companies.
SRAD also provides sports entertainment, gaming, and sports solutions, as well as live streaming solutions for online, mobile, and retail sports betting. In addition, SRAD’s software solutions address the entire sports betting value chain from traffic generation and advertising technology to the collection, processing, and extrapolation of data and odds, as well as to visualization solutions, risk management and platform services.
Sportradar Group has an expected revenue and earnings growth rate of 15.7% and 94.7%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.2% over the past 60 days.
Cintas Corp.
Cintas is well-positioned to benefit from the solid momentum across its segments. Penetration of additional products and services into existing customers is aiding CTAS’ Uniform Rental and Facility Services segment.
Improved demand for AED Rentals and WaterBreak products is driving CTAS’ First Aid and Safety Services segment. CTAS’ investments in technology and automation hold promise. The successive acquisitions of Paris Uniform and SITEX sparked optimism in the stock. Also, handsome rewards to its shareholders add to CTAS’ appeal.
Cintas has an expected revenue and earnings growth rate of 7.3% and 13.7%, respectively, for the current year (ending May 2025). The Zacks Consensus Estimate for current-year earnings has improved 1.9% over the past 60 days. Cintas has a current dividend yield of 0.77%. Moreover, CTAS currently has a ROE of 40.62%, compared with the industry’s ROE of 12.02% and the S&P 500’s ROE of 17.11%.
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