In this article, we discuss 11 Worst-Performing Blue Chip Stocks So Far in 2025.
Blue chip stocks are under immense pressure amid the evolving trade tensions and tariff announcements around the globe. The stocks are down by more than 15%, with some plummeting into bearish territory on shedding more than 20% in market value year to date.
The selloff has come on trading volumes reaching levels not seen in 18 years; investors are increasingly exiting positions. As the US implements sweeping tariffs and China retaliates, fears of a global trade war and recession concerns continue to dent the market outlook.
“The president is losing the confidence of business leaders around the globe…this is not what we voted for,” wrote Bill Ackman, the billionaire head of Pershing Square, on X. “The President has an opportunity on Monday to call a timeout and have the time to execute on fixing an unfair tariff system. Alternatively, we are heading for a self-induced, economic nuclear winter and should start hunkering down.”
While blue-chip stocks come from well-known, established companies with a strong performance history, they are the most susceptible to changes in trade policies and tariffs. That’s because their business operations span various borders. This might explain why the stocks come under pressure every time the US imposes tariffs, followed by retaliatory measures from other nations.
Similarly, the prospects of the US Federal Reserve sticking with high interest rates to try and tame inflationary pressure from getting out of hand amid the trade war is another major headwind taking a toll on large-cap companies. Last year, the stocks exploded on expectations that the Central Bank would cut interest rates on inflation, dropping to acceptable levels.
Likewise, blue chip stocks exploded on the artificial intelligence-driven run amid growing expectations of multibillion-dollar opportunities around revolutionary technologies. Fast forward, interest rate cut expectations have faded, and investors have started questioning opportunities around AI. The development of low-cost AI models is one factor that has significantly affected sentiments in the semiconductor sector, triggering a recalibration of the long-term outlook.
According to analysts at research firm Citi, President Donald Trump’s tariff push could plunge the U.S. economy into a recession. In return, chip stocks could plunge by over 20% as they remain the most susceptible.
“We believe the biggest risk to the semi sector is a recession resulting from tariffs,” Chris Danely, a managing director at the bank, wrote to clients in a recent note. “If the tariffs continue for another month, we believe is it highly likely the supply chain will ‘freeze up’ given uncertainty, drastically lower order rates/inventory, and result in lower guidance across the board – similar to Covid.”
On the other hand, semiconductor stocks are not the only ones under pressure amid the escalating trade wars. Energy, industrials, and healthcare stocks are also feeling the brunt, resulting in some of the worst-performing blue chip stocks so far in 2025.
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Our Methodology
To prepare this article, we began by listing all the holdings of the various blue chip ETFs like E.A. Bridgeway Blue Chip ETF and Vanguard Mega Cap ETF, among others. We then sourced the year-to-date share price returns for each company and selected the worst performers, as of April 25. We have also mentioned the hedge fund sentiment around each stock, as of Q4 2024. The stocks are ranked in descending order of their year-to-date performance.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
11 Worst-Performing Blue Chip Stocks So Far in 2025
11. Merck & Co., Inc. (NYSE:MRK)
Year To Date Share Price Return as of April 25: -16.57%
Number of Hedge Fund Holders: 91
Merck & Co., Inc. (NYSE:MRK) is a healthcare company that discovers, develops, and sells pharmaceutical products. Its products treat a wide range of diseases, including cancer, heart-related conditions, and infectious diseases. It is one of the companies hit hard by the newly implemented tariffs between the US and China. Consequently, the stock is down by about 17% for the year.
Merck & Co., Inc. (NYSE:MRK) has been under pressure amid growing concerns over demand for its human papillomavirus vaccine, Gardasil, especially in China. The woes persisted as the company delivered mixed first-quarter 2025 results characterized by a 41% drop in Gardasil sales to $1.33 billion. It marked the third consecutive quarter of decelerating sales amid lackluster demand in China.
The pharmaceutical company was forced to pause shipments of the HPV vaccine in China in the fourth quarter as one of the ways of managing inventory. Due to mounting serious concerns, Merck & Co., Inc. (NYSE:MRK) has also been forced to pull back its expected sales forecast of $11 billion for the vaccine. Amid the concerns, the company delivered solid Q1 results with revenues of $15.5 billion, above its forecast of $15.3 billion to $15.4 billion, as earnings increased 7% year-over-year to $2.22 a share. Cantor Fitzgerald initiated coverage of the stock on April 22 with a Neutral rating and an $85 price target.
10. Adobe Inc. (NASDAQ:ADBE)
Year To Date Share Price Return as of April 25: -16.62%
Number of Hedge Fund Holders: 117
Adobe Inc. (NASDAQ:ADBE) is a technology company that develops and provides software and digital marketing solutions. The company offers a range of products, including creative software, document management tools, and digital marketing platforms. Its stock has pulled back significantly after being one of the biggest beneficiaries of the AI-driven run. While the stock is down by about 17%, analysts at RBC Capital Markets have cut their price target to $480 from $530 while reiterating an Outperform rating.
The price cut comes amid growing concerns that Adobe Inc. (NASDAQ:ADBE) faces significant competition pressure in the generative AI content tool sector. While the company maintains a strong presence in the AI content tool sector, it is under immense pressure as more tools emerge. The rise of several generative AI models offering free picture-generation capabilities is one aspect that continues to send jitters among the investment community.
Adobe Inc. (NASDAQ:ADBE) forecasts weaker-than-expected sales and earnings for its fiscal Q2 2025 and full year, which is one of the headwinds that continue to take a toll on its sentiments in the market. Adobe expects its Q2 2025 earnings to average between $4.95 and $5, as analysts expect EPS of $5. It’s also projecting revenues of between $5.77 billion and $5.82 billion against analyst estimates of $5.80 billion. The weaker-than-expected guidance continues to fuel concerns that the company is falling behind its competitors in generative AI. Last year, generative AI contributed a partial of $125 million of the total $4.23 billion that the company generated.
9. Broadcom Inc. (NASDAQ:AVGO)
Year To Date Share Price Return as of April 25: -17.10%
Number of Hedge Fund Holders: 161
Broadcom Inc. (NASDAQ:AVGO) is a technology company that designs, develops, and supplies semiconductor and infrastructure software solutions. Its solutions are used in various applications like data centers, networking, broadband, and wireless communication. It is one of the worst-performing blue chip stocks.
Most of the company’s chips are made in Taiwan and are therefore susceptible to a 125% tariff from China. Consequently, it is vulnerable to supply chain disruptions on escalating US-China trade tensions as it generates roughly 20% of its revenues from shipments in China. On April 9, analysts at TD Cowen cut the price target on Broadcom Inc. (NASDAQ:AVGO) to $200 from$265, concerned by the long-term impact of the tariff war. Nevertheless, the firm maintains a Buy rating on the stock as it is expected to benefit from strong demand for its application-specific integrated chips (ASICs) for AI and machine learning applications.
Broadcom Inc. (NASDAQ:AVGO) is also banking on enormous AI opportunities as its three hyperscaler clients have begun creating their own XPUs. Each customer is expected to set up one million XPU clusters on a single fabric by 2027, as the serviceable addressable market for XPUs and networks is projected to reach between $60 billion and $90 billion by 2027.