Some of 2026’s biggest stock-market losers could be about to face another problem: investors selling them simply because they have already lost so much money.
With mutual funds approaching fiscal year-end, professional money managers have an incentive to unload losing positions and use those losses to offset gains elsewhere. Wolfe Research warns that this annual tax-loss selling season could put additional pressure on stocks including Nike, Lululemon, Roblox, Strategy and Oracle.
For individual investors, there are two reasons to pay attention. Stocks already down 30%, 40% or 50% can fall further when forced selling accelerates. At the same time, investors sitting on losses of their own may have an opportunity to turn some of that pain into a lower tax bill.
Why September Can Be Brutal for Losing Stocks
The S&P 500 has gained more than 11% in 2026, but the strength of the broader market hides enormous differences underneath the surface.
Some individual stocks have been crushed.
Wolfe Research recently updated a basket of potential tax-loss selling candidates. To qualify, stocks had to meet at least one of several measures of significant underperformance, including falling more than 20% this year, losing more than 20% over the previous 12 months, or trading at least 20% below their 12-month volume-weighted average price.
Among the names identified by Wolfe:
| Stock | Ticker | 2026 Performance | 12-Month Performance |
|---|---|---|---|
| VICI Properties | VICI | -10.1% | -23.7% |
| Strategy | MSTR | -11.2% | -58.9% |
| Oracle | ORCL | -16.4% | -32.5% |
| Campbell’s | CPB | -21.1% | -34.8% |
| Intuitive Surgical | ISRG | -38.0% | -24.9% |
| Nike | NKE | -41.5% | -49.4% |
| Roblox | RBLX | -44.6% | -65.9% |
| Lululemon Athletica | LULU | -51.7% | -39.4% |
Those declines alone do not mean the stocks will continue falling. They do, however, make them potential targets for a type of selling that has little to do with what the companies are worth.
That distinction matters.
Mutual Funds Have a Reason to Dump Their Worst Performers
Many mutual funds have fiscal years ending in September, October or December. As those dates approach, portfolio managers can sell losing positions to offset gains realized elsewhere in their portfolios.
That can reduce taxable capital gains ultimately distributed to fund shareholders.
There is also a less technical motivation: window dressing.
A portfolio manager preparing an annual report may have little desire to explain why a stock that fell 40% or 50% remains among the fund’s holdings. Selling the position before the reporting date removes the name from the portfolio and allows the manager to redeploy the remaining capital.
Wolfe Chief Investment Strategist Chris Senyek said avoiding the market’s biggest year-to-date losers has historically generated positive alpha heading into the final months of the year.
The implication is important for investors trying to bottom-fish.
A stock that appears cheap after falling 40% can become even cheaper if large institutional shareholders have reasons to sell regardless of valuation.
Nike Shows How the Pressure Can Build
Nike is one of the most striking names on Wolfe’s list.
Shares have fallen more than 40% in 2026 and nearly 50% over the past 12 months as investors have grown increasingly skeptical about the company’s turnaround.
The stock’s weakness reflects real business concerns rather than tax mechanics alone. Nike has faced slowing lifestyle demand, problems in China, margin pressure and uncertainty about how quickly management can restore growth.
Wall Street has become increasingly cautious as a result.
Recent bearish analyst commentary has focused on the possibility that the recovery could take substantially longer than investors originally expected. Nike shares recently traded near their lowest levels in roughly 12 years.
That creates a potentially dangerous combination heading into tax-loss season: weak fundamentals, negative sentiment and a large pool of shareholders sitting on losses.
An investor who bought Nike at $70 and still believes in its long-term future might be willing to wait. A mutual fund manager trying to clean up a portfolio before fiscal year-end may have a very different incentive.
That is how selling can feed on itself.
Lululemon and Roblox Have Even Bigger Losses
Nike is hardly alone.
Lululemon has lost more than half its value in 2026 according to Wolfe’s screen, while Roblox has fallen nearly 45% this year and almost 66% over 12 months.
Those are precisely the types of declines that can attract tax-related selling.
Consider the psychology. An investor with a stock up 40% has an unrealized gain they may prefer to leave untouched. An investor with another position down 50% has something potentially valuable sitting inside the portfolio: a tax loss.
Selling the loser can help offset taxable gains generated by selling the winner.
Multiply that decision across thousands of investors and hundreds of institutional portfolios and the result can become a seasonal market force.
Even Oracle and Strategy Made the List
One of the more interesting aspects of Wolfe’s screen is that it includes companies investors may still associate with powerful long-term themes.
Oracle, for example, has become deeply tied to the enormous buildout of artificial intelligence infrastructure. Yet its shares are down sharply over the past year as investors wrestle with the costs, debt and margins associated with that expansion.
Strategy presents an entirely different situation. Its massive exposure to Bitcoin has made the stock behave partly like a leveraged proxy for cryptocurrency sentiment. Wolfe’s data showed the shares down almost 59% over the previous 12 months.
These examples illustrate why tax-loss selling screens should never be interpreted as lists of fundamentally bad companies.
The common characteristic is something simpler: a lot of shareholders are losing money.
And those losses can become financially useful before year-end.
Retail Investors Could Create a Second Selling Wave
Institutional tax-loss selling may become more visible in September and October, but Wolfe sees another potential wave beginning around mid-November and continuing into December.
That is when individual investors increasingly start thinking about their own tax bills.
Suppose an investor realized a $20,000 capital gain earlier this year but owns another investment carrying a $12,000 unrealized loss.
Selling the losing investment could potentially allow that investor to realize the $12,000 loss and use it to offset capital gains, depending on the investor’s overall tax situation.
For investors whose capital losses exceed their capital gains, federal tax rules can provide an additional benefit.
The IRS generally allows individuals to deduct up to $3,000 of net capital losses against other income each year, or $1,500 for married taxpayers filing separately. Losses above the annual limit generally can be carried forward into future tax years.
That means a losing investment can sometimes have tax value even when there are insufficient gains available to offset it immediately.
Investors should consult a qualified tax professional about their specific circumstances.
The Wash-Sale Rule Can Ruin the Strategy
There is one major trap.
An investor cannot simply sell a stock for a tax loss and immediately buy it back.
Under the IRS wash-sale rule, a loss generally cannot be deducted if an investor sells stock or securities at a loss and acquires substantially identical securities within 30 days before or after the sale.
The “before” part is particularly easy to overlook.
The rule effectively creates a 61-day window centered on the sale date, so investors need to consider purchases made before the loss was realized as well as purchases afterward.
The IRS also says wash-sale treatment can apply when substantially identical securities are acquired inside an IRA or Roth IRA.
For investors deliberately harvesting losses, recordkeeping and timing therefore matter.
The Bigger Opportunity May Come After the Selling
There is another side to this story.
Tax-loss selling can push down stocks for reasons unrelated to a company’s underlying value. Once the calendar turns and that artificial selling pressure disappears, some beaten-down stocks can become candidates for a rebound.
That does not mean buying every stock that has fallen 40%.
Some stocks are down because their businesses have deteriorated, their valuations were excessive or investors were previously expecting growth that never materialized.
The more interesting opportunity comes when tax-driven selling temporarily exaggerates a decline in a company whose fundamental outlook is stabilizing.
That creates an important distinction for investors evaluating Wolfe’s list.
Ask why the stock is down.
If earnings expectations are still collapsing, debt is becoming problematic or the business is losing market share, a lower share price may simply reflect deteriorating fundamentals.
If the business is improving while the stock remains under pressure because shareholders are harvesting losses, the setup becomes considerably more interesting.
That is where tax-loss season can eventually create opportunities rather than simply warnings.
The Investor Takeaway
Investors sitting on big winners and big losers should start reviewing their portfolios before December.
The most beaten-down stocks of 2026 could face additional pressure as mutual funds and eventually individual investors harvest losses. Wolfe Research’s list puts VICI Properties, Strategy, Oracle, Campbell’s, Intuitive Surgical, Nike, Roblox and Lululemon among the names worth watching.
For shareholders who already own these stocks, the decision should involve more than asking whether they are down too much to sell. A realized loss can have genuine tax value, while holding a deteriorating investment simply to avoid admitting a mistake can compound the damage.
For investors looking to buy, patience could also matter.
Some of this year’s biggest losers may get cheaper as tax-loss selling accelerates. If the underlying businesses begin stabilizing at the same time, the more attractive entry point may emerge after other investors finish dumping their losses.
Sometimes the stock market’s losers become most interesting precisely when everyone else has a reason to get them off the books.
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