The S&P 500 has seen impressive returns since its bear market bottom in 2022, with a total return of 26% in 2023 and 25% in 2024. However, stock prices have outpaced business fundamentals, leading to record-high valuations. Nygren of Oakmark Capital sees opportunities in the market despite these challenges.

The composition of the S&P 500 has shifted significantly, with the top 10 companies now accounting for nearly 40% of the index’s value. High-growth tech stocks dominate the top spots, driving overall valuations to record levels. Nygren believes there are still undervalued stocks in the market for savvy investors to capitalize on.

Nygren’s Oakmark U.S. Large Cap ETF holds a diverse portfolio, with heavy weights in financial stocks like Citigroup and Charles Schwab. He also sees value in Alphabet, pointing to the company’s venture capital arm as an undervalued asset. Nygren’s focus on shareholder value and effective management guides his investment strategy in today’s market.

While the market may seem overvalued, Nygren’s approach to finding undervalued stocks within the S&P 500 offers opportunities for long-term growth. By focusing on companies with strong fundamentals and shareholder-friendly practices, investors can potentially outperform in the current market environment.

For those considering investing in Harris Oakmark ETF Trust – Oakmark U.S. Large Cap ETF, it’s important to weigh the potential opportunities against expert recommendations. The Motley Fool’s Stock Advisor team has identified the top 10 stocks for investors, offering insights into high-growth potential and market-beating returns. Don’t miss out on the latest opportunities in the market with expert guidance.

Read more at Nasdaq: Think Stocks Are Expensive? Top-Performing Fund Manager Bill Nygren Says This Is Where to Look For Great Investment Opportunities