Buying stocks everyone loves is a recipe for underperformance — but Apple breaks the rule

Core Insights - Popularity on Wall Street can lead to short-term stock gains but may negatively impact long-term performance [1] - The relationship between high popularity and future success is inversely correlated, as noted in Ralph Keyes's work [2] Group 1: Performance of Most Admired Companies - The 10 most admired companies from Fortune's previous ranking underperformed compared to companies with the worst reputations over the past year [3] - The top 15 companies on Fortune's 2025 list lagged behind the S&P 500 on average, while companies with poor reputations significantly outperformed the market [5] Group 2: Exceptions and Studies - Apple is highlighted as an exception, having maintained its top position in Fortune's rankings for 19 years while outperforming the U.S. market [5] - A study in the Journal of Corporate Finance found that an increase in a company's ranking typically leads to reduced stock performance [6] - Another study on "Superstar CEOs" revealed that companies with such CEOs experienced an average stock decline of 60% over three years following their rise to fame [7]