The iShares Core S&P Total U.S. Stock Market ETF (NYSE:ITOT) has been a strong performer, returning 16.4% through mid-December 2025. With analysts projecting S&P 500 earnings to grow by 11% in 2026, investors are wondering if ITOT can continue its rally.
ITOT’s top 10 holdings make up 37% of its assets, with Nvidia alone accounting for 7.3%. The fund has a significant allocation to the technology sector, representing 33% of its portfolio. Nvidia reported an impressive 62% revenue growth in its most recent quarter, driven by strong demand for AI chips.
However, the key to ITOT’s performance in 2026 will depend on U.S. corporate profit growth. Analysts expect S&P 500 earnings to grow by 11% next year, which could translate to high single-digit to low double-digit price appreciation for ITOT, plus an additional 1% from dividends.
Investors should be cautious of potential risks, such as overly optimistic earnings estimates. If the market shifts towards smaller companies or value stocks in 2026, ITOT’s heavy tech weighting could lead to underperformance. Monitoring quarterly earnings reports, especially from mega-cap tech companies, will be crucial in assessing the fund’s performance.
ITOT holds over 3,600 stocks, providing broad diversification. Its 33% allocation to the technology sector has been beneficial in 2025, but could pose a risk if market dynamics change. Keeping an eye on Nvidia’s quarterly reports and any signs of slowdown in AI infrastructure spending by cloud providers will be important indicators for ITOT’s performance.
The fund recently increased its quarterly dividend by 4% year-over-year, reflecting steady corporate cash generation. With a low expense ratio of 0.03% and $80 billion in assets, ITOT offers tight tracking and low trading costs for investors.
In comparison, the Vanguard Total Stock Market ETF (NYSE:VTI) offers similar exposure with a 0.03% expense ratio and $450 billion in assets, providing deeper liquidity for large trades.
Ultimately, ITOT’s performance in 2026 will depend on whether corporate earnings meet expectations. Monitoring Nvidia’s trajectory and quarterly reports will be essential in determining the fund’s success. Investors should stay informed and adapt their strategies accordingly to navigate potential market shifts and maximize returns.
