9 stocks still screening for Quality but down 30%+

The market is stronger than many stocks underneath it

Looking only at the major indices, investors could be forgiven for thinking equities have held up remarkably well.

The S&P 500 is still within roughly 2% of its record high despite Treasury yields surging, with the US 10-year reaching around 5.3% this week. But underneath the index, the picture looks very different. More than 40% of S&P 500 companies are at least 20% below their 52-week highs, while the median constituent is around 16% below its high.

That divergence matters. Higher bond yields, concerns around the sustainability of AI spending and changing expectations for economic growth have produced a much more selective market. Some companies have fallen because their earnings outlook has deteriorated. Others have simply been caught in changing sentiment, sector rotations or valuation compression.

So we ran a screen looking for the latter.

What did we screen for?

Starting with primary-listed companies across the US, Canada, Western Europe, Japan, Hong Kong, Singapore and Australia, we required:

• Market capitalisation above US$100 billion
• At least 30% below the 52-week high
• Return on equity above 15%
• Positive trailing 12-month free cash flow
• Net debt/EBITDA below 2.5x
• Positive three-month revisions to next year's consensus EPS estimate

The first test produced 30 companies trading at least 30% below their highs. After applying the quality, balance-sheet, cash-flow and earnings-revision tests, only nine remained.

That doesn't mean all nine are bargains. It tells us something more specific: their share prices have fallen sharply without analysts cutting their forward earnings expectations.

1. Kioxia: down 52%, earnings estimates up 29%

Kioxia Holdings has the largest drawdown in the screen, trading around 52% below its 52-week high, yet next-year EPS estimates have risen approximately 29% over the past three months, according to the Bloomberg screen.

That makes it perhaps the purest example of the disconnect we're looking for.

The Japanese company is one of the world's major NAND flash-memory producers. Its shares have been caught in the recent reassessment of the AI and memory trade after an extraordinary earlier rally, with concerns around AI investment and the memory cycle weighing on sentiment.

What to watch: NAND pricing, memory demand, AI infrastructure spending and whether the unusually strong earnings revisions continue. Memory remains highly cyclical, so today's rising estimates could reverse quickly if supply catches up with demand.

2. Western Digital: down 43%, estimates up 18%

Western Digital is approximately 43% below its high, while Bloomberg's consensus next-year EPS estimate has increased around 18% in three months.

Following the separation of its flash business, Western Digital is more focused on hard-disk drives. Growing data creation and data-centre storage requirements provide a structural demand argument, although storage remains cyclical.

The size of the gap between its share-price performance and earnings revisions makes this one of the more interesting names produced by the screen.

What to watch: hyperscaler storage demand, pricing, margins and whether estimates continue moving higher after the recent technology-sector correction.

3. Corning: down 42%, estimates up 4%

Corning sits roughly 42% below its high, despite analysts raising next-year EPS estimates around 4%.

Its optical-communications business has been benefiting from demand for fibre and connectivity infrastructure, but the company is considerably more diversified than a pure AI infrastructure stock. In its latest reported quarter, Optical Communications sales rose 32%, while Corning guided to approximately 16% core-sales growth in the following quarter.

There is also a fresh catalyst: AT&T has just signed a more than $3 billion multi-year fibre agreement with Corning, following another large agreement with Verizon earlier this month

That makes the recent correction particularly interesting if earnings expectations continue to hold.

What to watch: optical communications demand, data-centre spending and margin progression.

4. Accenture: down 39%, estimates still rising

Accenture is nearly 39% below its 52-week high, while forward EPS estimates in the Bloomberg screen remain marginally positive.

That makes this one different from Kioxia or Western Digital. The investment debate isn't being driven by falling earnings estimates so much as concern about what AI could eventually mean for traditional consulting and outsourcing.

Accenture's last reported quarter still showed revenue growth, 9% EPS growth and $3.6 billion of free cash flow.

What to watch: tomorrow's bookings, FY2027 guidance and—perhaps most importantly—what management says about whether AI is expanding or cannibalising its addressable market.

5. Novo Nordisk: down 39%, estimates up 5%

Novo Nordisk is approximately 39% below its high, but next-year EPS estimates have risen around 5% over the past three months.

The share-price reset reflects a major reassessment of what investors should pay for its obesity franchise as competition increases and expectations for future growth become more demanding. Yet the screen suggests analysts have not abandoned the earnings story.

The company is responding by widening its pipeline. At its September Capital Markets Day, Novo set a goal of launching more than five multi-blockbuster medicines by 2030, while it has also announced new licensing deals to strengthen its obesity pipeline.

What to watch: obesity-drug market share, competition, pricing, pipeline data and whether estimate revisions remain positive. The risk here is that today's earnings forecasts still prove too optimistic as competition intensifies.

6. KLA: down 36%, estimates up 10%

KLA Corporation is around 36% below its high, while next-year earnings estimates have risen approximately 10%.

KLA makes process-control and inspection equipment used in semiconductor manufacturing. As chips become more complex, manufacturers need increasingly sophisticated tools to identify defects and improve production yields. Its latest quarter delivered revenue above the midpoint of guidance, while management said momentum was strengthening into the second half of 2026 and 2027, supported by leading-edge chips, memory and advanced packaging.

The stock therefore sits at an interesting intersection: AI-related semiconductor fundamentals can remain strong even while investors become less willing to pay peak valuations for the theme.

What to watch: semiconductor capital spending, advanced-node investment, China exposure and whether the recent AI correction broadens.

7. Zijin Mining: down 32%, estimates slightly higher

Zijin Mining is around 32% below its high, while forward earnings expectations remain slightly positive.

Zijin is very different from most of the technology-heavy names on this screen. Its earnings are tied primarily to metals including copper and gold, making it potentially relevant to investors looking for diversification away from technology.

The modest estimate revision is important, however. Unlike Kioxia or Western Digital, this isn't a case where analysts have dramatically upgraded the earnings outlook while the shares fell.

Copper's underlying supply picture remains tight. China's refined copper-output growth is expected to slow sharply this year as concentrate availability constrains smelters.

What to watch: copper and gold prices, China demand, mine production and costs.

8. Intuitive Surgical: down 32%, estimates up 3%

Intuitive Surgical is approximately 32% below its high, while next-year EPS estimates have increased around 3%.

The company dominates robotic-assisted surgery through its da Vinci systems. Recent operating trends have remained solid, including continued procedure growth and adoption of newer platforms such as da Vinci 5.

Its inclusion is therefore less about an obvious collapse in earnings expectations and more about the valuation investors are prepared to pay for long-duration growth when bond yields are high.

What to watch: procedure growth, new-system placements, competition and valuation.

9. Applied Materials: down 31%, estimates up 12%

Applied Materials is around 31% below its high, while next-year EPS estimates have risen more than 12% in the last 90 days.

Its latest quarter produced record revenue of US$9.12 billion, up 25% year-on-year, while non-GAAP EPS increased 41%.

Applied Materials therefore captures the central tension in this screen particularly well: semiconductor fundamentals can remain strong even as investors reassess how much they are prepared to pay for exposure to the AI investment cycle.

Watch: semiconductor equipment spending, memory capex, AI infrastructure investment and China exposure.

What does the screen tell us?

There are really three different stories hiding inside the same screen.

Kioxia, Western Digital, KLA and Applied Materials have been caught in the broader semiconductor and AI reset even as earnings estimates have risen strongly. Corning also retains exposure to data-centre infrastructure, but through fibre and connectivity rather than chips.

Novo Nordisk and Intuitive Surgical represent a different issue: investors are reassessing the valuation they are prepared to pay for previously highly valued healthcare growth.

Accenture faces a more fundamental question around AI disruption, while Zijin Mining brings exposure to a completely different commodity cycle.

That distinction matters. A 30% decline is not itself an investment case.

What makes these nine worth a second look is that the decline has occurred despite positive free cash flow, relatively strong profitability, manageable leverage and analysts continuing to raise, or at least not cut, their next-year earnings forecasts.

The next stage of the analysis is valuation. Investors may want to ask whether each stock now trades below its own historical valuation range, whether earnings revisions remain positive and, crucially, whether there is a catalyst capable of closing the gap between price and fundamentals.

The headline index may still look resilient. Underneath it, however, some substantial resets have already taken place. This screen helps identify where the share price has fallen without the earnings outlook following it down.

Source: Bloomberg screening data, 30 September 2026. Screening criteria and companies are illustrative and do not constitute investment recommendations. Analyst estimates can change rapidly, and positive revisions do not guarantee future earnings growth. A share-price decline does not by itself indicate that a stock is undervalued.