The S&P 500 encompasses more than 500 companies across diverse industries, containing many financially sound businesses with strong underlying metrics that deserve investor attention. This diversity creates attractive opportunities for those willing to move past the most publicized stocks and conduct thorough research.
Through Validea’s comprehensive analysis framework incorporating 22 different investment methodologies, we’ve identified ten S&P 500 companies with robust fundamental characteristics that appear particularly attractive at current valuations. Our evaluation integrates time-tested strategies from renowned investors, including Warren Buffett’s focus on durable competitive advantages and strong capital allocation, Peter Lynch’s approach to reasonable valuations relative to growth prospects, and Benjamin Graham’s requirement for sufficient margin of safety.
While these companies may not capture media attention like major technology stocks, they demonstrate excellence in the essential factors that drive long-term wealth creation. They generate consistent cash flows, maintain solid balance sheets, possess defensible competitive positions, and are priced reasonably relative to their intrinsic business worth. These characteristics make them well-suited to deliver reliable returns for investors who value fundamental quality and employ a disciplined, value-focused investment strategy.
Here are the top 10 most fundamentally sound stocks within the index using our guru models as of September of 2025.
| Ticker | Company Name | Price | Market Cap ($mil) | PE Ratio | Price/ Sales | Relative Strength | Price/ Book | Price/ Cash Flow | Dividend Yield |
|---|---|---|---|---|---|---|---|---|---|
| PAYC | PAYCOM SOFTWARE INC | $214.73 | $12,080 | 29.0 | 6.2 | 74 | 6.7 | 21.0 | 0.7% |
| PHM | PULTEGROUP INC | $134.10 | $26,458 | 10.0 | 1.5 | 46 | 2.1 | 9.3 | 0.6% |
| MRK | MERCK & CO INC | $81.14 | $202,670 | 12.5 | 3.2 | 26 | 4.2 | 9.6 | 3.9% |
| CMCSA | COMCAST CORP | $32.43 | $119,738 | 5.4 | 1.0 | 35 | 1.2 | 3.1 | 4.0% |
| XOM | EXXON MOBIL CORP | $115.29 | $491,510 | 16.4 | 1.5 | 55 | 1.9 | 8.6 | 3.4% |
| GWW | WW GRAINGER INC | $997.93 | $47,733 | 25.2 | 2.7 | 48 | 13.0 | 21.2 | 0.8% |
| QCOM | QUALCOMM INC | $165.26 | $178,117 | 16.0 | 4.1 | 48 | 6.6 | 13.5 | 2.1% |
| TAP | MOLSON COORS BEVERAGE CO | $46.86 | $8,820 | 9.2 | 0.8 | 36 | 0.7 | 4.8 | 3.9% |
| RMD | RESMED INC | $271.71 | $39,782 | 28.6 | 7.7 | 62 | 6.7 | 24.3 | 0.8% |
| UHS | UNIVERSAL HEALTH SERVICES INC | $187.39 | $11,925 | 9.9 | 0.7 | 34 | 1.7 | 6.3 | 0.4% |
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