S&P 500 Stocks — Scored by 5 Investment Models

Maintained by S&P Dow Jones Indices, the S&P 500 tracks approximately 503 large-capitalisation US companies with a combined market capitalisation covering roughly 80% of the total US equity market. It is not merely a list of big companies — it is a curated, quality-screened benchmark that defines how the financial world measures performance.

The inclusion bar is high. A company S&P adds must show positive earnings in its most recent quarter and over the trailing four quarters combined, and a market capitalisation of $22.7 billion or more (S&P's guideline effective July 1, 2025). There are minimum requirements for public float and trading liquidity. These rules apply at addition, not to continued membership: a company already in the index is not automatically removed when it falls below them; the committee decides when one no longer belongs.

For investors, this quality gate is the feature, not a technicality. It means every stock in the S&P 500 was profitable, liquid, and institutionally investable when it was added — an ideal universe for fundamental analysis. Unlike rules-based indices that include everything above a market cap threshold, the S&P 500 already filters out the weakest companies before you even open a screener.

Every S&P 500 stock receives a composite score from 0 to 10, blending four scoring axes:

Five investment models feed these axes: Piotroski F-Score and Buffett Quality Assessment drive the Quality axis. Graham's defensive-investor criteria, Lynch PEG, and Greenblatt Magic Formula drive the Value axis. Momentum is the 12-1 month price return, ranked across every covered stock. Timing equals min(Value, Momentum) — the value-trap killer.

Scoring weights are calibrated by sector. A bank is evaluated differently from a tech company, which is evaluated differently from a REIT. Seven sector-specific profiles ensure fair cross-sector comparisons.

We backtest the formula point-in-time on the S&P 500. A portfolio of the top 10 highest-scoring stocks, rebalanced monthly, ended slightly ahead of the index, but the excess is not statistically significant and is mostly market exposure. Treat the scores as a way to build a research shortlist, not a return forecast. See the full backtest results for methodology details and disclaimers.

The S&P 500 spans all 11 GICS sectors, but the weighting tells a story of dominance. Information Technology alone accounts for roughly 30% of the index. The top 10 stocks represent over 35% of total capitalisation — a level of concentration not seen since the early 1970s. Materials and Real Estate each contribute less than 3%. When the “market” rallies, it is often 10 stocks pulling the other 493 along. Scoring each stock individually, as AlphaStocks does, reveals opportunities the cap-weighted index hides.

AlphaStocks addresses this imbalance through sector-calibrated scoring. Each sector has its own scoring profile, ensuring that a utility company earning a 7.5 genuinely compares to a tech company earning 7.5 — they simply reached that score through different evaluation criteria.