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| With yields at 24-year highs and more hikes on the way, plenty of analysts rushed to call a new market top. Well, not so fast. Even as the Fed, ECB, and Bank of Japan all tighten, corporate earnings are on track to grow nearly 30% this year, and that profit engine has been enough to keep the S&P 500 and Nasdaq within 1% of record highs. |
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| But higher rates are quietly reshaping the market beneath the surface. As capital grows more expensive, investors are no longer paying up for growth at any price, instead rewarding the companies that can fund themselves and keep expanding profits as borrowing costs climb. The result is a narrower, more discerning market, one that prizes earnings power and balance-sheet strength over momentum alone. |
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| That is where our AI's October rebalance leaned. It trimmed NetApp after a +37.9% gain and Texas Instruments after a modest pullback, both above our models' fair value with margins under pressure, and added Onto Innovation, a semiconductor-inspection leader growing revenue ~35% a year with every covering analyst rating it a buy, and Axcelis, a chip-equipment maker up ~84% this year that still trades around two-thirds of its 52-week high with a debt-free balance sheet. |
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| Strategy performance · as at Oct 1 close |
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| Tech Titans |
| +225.58% Return since launch |
| +143.25pp vs S&P 500 |
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| Mid-Cap Movers |
| +102.62% Return since launch |
| +48.47pp vs S&P Midcap 400 |
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| Energy Elite |
| +72.70% Return since launch |
| +30.29pp vs S&P 500 Energy |
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| Tech Titans - October performance |
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| Strategy return |
| +13.4% |
| October 2026 |
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| vs. S&P 500 |
| +12.9pp |
| Outperformance |
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| Spotlight exit |
| +37.9% |
| NTAP - exited |
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| Max drawdown |
| -36.9% |
| POWI - exited |
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| Exited from Tech Titans this month |
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| NTAP |
| NetApp Inc · Held 92 days |
| Total return since picked |
| +37.9% |
After a near-100% year-to-date surge where high expectations are already heavily priced in, evidenced by a ~9% post-earnings drop despite a strong Q1 beat, the model reallocated capital as the ~$210 price stretched well past both its ~$198 analyst consensus and ~$164 fair value targets. Fundamentals remain solid with ~30% quarterly revenue growth and a perfect Piotroski score, but rising flash-component costs and expected margin moderation narrowed the remaining margin of safety.
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| TXN |
| Texas Instruments · Held 122 days |
| Total return since picked |
| -3.6% |
| TXN rotated out as the model found stronger opportunities elsewhere in the sector. The stock trades at a P/E near 42x with a PEG above 2 and sits near ~$280, above InvestingPro's ~$251 fair value, leaving a thin margin of safety. Gross-margin guidance stays flat as heavy capex ($2-3 billion a year) suppresses near-term expansion, and despite a ~64% year-to-date gain the stock dipped after an earnings beat. Free cash flow has surged to $6.5 billion, with a 23rd straight annual dividend raise. |
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| New picks inside Tech Titans: |
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| Onto Innovation · Information Technology |
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| ~$343M Q2 revenue (+35% YoY)$1.1B backlog |
| A record Q2 revenue of ~$343 million, up ~35% year-over-year, an ~80% full-year surge in advanced packaging, and a backlog exceeding $1.1 billion extending into 2027 demonstrate rapid operational acceleration. While a ~124% one-year rally and fresh ~20% one-month gain reflect powerful market momentum, an average analyst target of ~$386 and unanimous Strong Buy ratings from all eight Wall Street analysts signal meaningful remaining upside. Expanding AI-driven demand for its Dragonfly and Atlas inspection systems also positions the business for sustained long-term expansion. |
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| Axcelis · Information Technology |
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| 19% Q2 EPS beat~$161 analyst target |
| Q2 revenue growth of ~11% year-over-year, a ~19% earnings beat, a raised full-year outlook, and ~35% growth in aftermarket services demonstrate rapid operational acceleration. While a ~63% year-to-date rally reflects strong market momentum, trading at roughly 68% of its 52-week high alongside an analyst target of ~$161 (~23% upside) signals meaningful remaining recovery potential. A debt-free balance sheet backed by $577 million in cash, expanding positions in silicon carbide power and memory, and a pending merger with Veeco Instruments also position the business for sustained long-term growth. |
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| Tech Titans full list of stock picks for October: |
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| ONTO |
| Onto Innovation · Information Technology |
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+107.6% |
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| ACLS |
| Axcelis · Information Technology |
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+83.9% |
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| 🔒 |
| Tech Titans full list of stock picks for October: |
| Investing.com paid subscribers get the full list, live rebalances, and Fair Value scores — updated monthly. |
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| *Data correct to Oct 1, 2026 |
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