In this article4 sections
Value stocks have outperformed growth stocks by roughly 29 percentage points over the past 12 months and by about 23% year-to-date, Protos reported. The iShares Russell 1000 Value ETF returned about 29% including dividends over that period, while its counterpart, the iShares Russell 1000 Growth ETF, lost about 2%.
Protos noted that blue-chip growth names including Nvidia, Broadcom and Tesla declined over the past year. The underperformance held across the 12-month, year-to-date and six-month windows, the outlet said.
Also read: Bitcoin's $707B loss overhang points to a months-long recovery
Key facts
- The iShares Russell 1000 Value ETF gained about 29%, dividends included, over 12 months; the iShares Russell 1000 Growth ETF shed about 2%.
- Year-to-date, growth stocks lagged value stocks by roughly 23%, or close to 30 absolute percentage points, per Protos.
- The S&P 500 trailing price-to-earnings ratio fell 13%, from about 25.8x to 22.4x, over the past year.
- The average PE of Nasdaq 100 constituents dropped by one-fifth, from 33.6x to 27x.
- The PE multiple at Amazon fell 37% over 12 months, and Alphabet’s fell 45%, according to Protos.
Multiple compression behind the index gains
Protos reported that the S&P 500 and Nasdaq 100 each rose a bit under 10% over the past 12 months, with gains driven by total market capitalization rather than higher earnings multiples. The decline in valuations was sharper at individual companies: Amazon’s PE fell 37% and Alphabet’s 45% over the same period.
The rotation is recent rather than a long-running trend. Protos traced a sell-off in AI stocks to the US midterm elections on November 3, which could lead to regulatory changes, with some investors fearing slower frontier model development or data center construction.
The outlet also pointed to a shift in how big tech spends its money. Meta devotes roughly 43% of revenue to capital projects and Microsoft about 39%, a move one commentator described as a transition from asset-light to asset-heavy business models, prompting the market to re-rate those companies.
Why it matters
Daily coverage of big tech can obscure how broadly growth names have lagged, so the gap matters for investors holding index funds weighted toward either style. Falling PE ratios show that even where headline index levels rose, investors paid less for each dollar of earnings, shifting where returns came from. For readers who followed AI-linked equities through the past year, the reversal is a change from the growth-led leadership that dominated earlier in the cycle.
What to watch
The next signal is how AI-linked stocks respond to any regulatory proposals arising from the post-election period, and whether the drawdown becomes durable. Future earnings reports from the large capital spenders such as Meta and Microsoft will show whether capital expenditure keeps weighing on valuations.
The comparison figures are historical performance, not a forecast; this is not financial advice, and both equity markets and the crypto prices listed alongside this coverage remain volatile and uncertain.
Reported by Protos.