Q4 2025 Stock Market Outlook: Where We See Opportunities for Investors
Q4 2025 Stock Market Outlook Key Takeaways
- The US stock market is at 3% a premium; it has traded this high only 15% of the time since 2010.
- Small-cap and value stocks are the last bastions of value left.
- Following this year’s rally, only real estate, energy, and healthcare remain undervalued.
As of Sept. 30, 2025, the US equity market was trading at a 3% premium over our fair value estimates. While this is not unprecedented, since 2010 the US stock market has traded at a higher premium only 15% of the time.
With the market trading slightly above fair value and almost 40% of market capitalization concentrated in just 10 mega-caps whose valuations are mostly leveraged to the build-out of artificial intelligence, it feels like there is no…
