In a surprising shift, value stocks have meaningfully outperformed growth stocks through the first nine months of 2026, reversing a long-standing trend.
As of September 4, the Vanguard Morningstar Value ETF (VTV) had delivered a 19.8% return year to date, nearly doubling the 9% gain posted by the Vanguard Morningstar Growth ETF (VUG).
What makes the trend even more striking is that several traditional tech names are among the key drivers of value’s outperformance this year.
Micron Technology (MU) leads the pack with a staggering year-to-date gain of more than 250%, making it the second-largest holding in the Vanguard Morningstar Value ETF.
Despite those explosive gains, Micron trades at a forward price-to-earnings ratio of less than 5.5, keeping it firmly in value territory by standard classification measures.
The chipmaker has been riding a powerful memory supercycle, driven by a supply shortage that has pushed prices sharply higher and delivered outstanding gross margins.
Demand for memory has accelerated rapidly due to the AI infrastructure build-out, while the time required to construct new foundries keeps supply constrained well into the future.
Micron has also taken the unprecedented step of signing long-term supply contracts with its largest customers, locking in price floors and volume commitments for up to five years.
Cisco Systems (CSCO) is the eighth-largest position in the value ETF and has climbed more than 40% this year, benefiting from a strong networking cycle tied to AI workloads and surging network traffic.
Orders from telecom network customers surged 30% last quarter, with robust demand for routers and optics, while enterprise orders rose a solid 21% in the same period.
Cisco’s security portfolio is also gaining momentum from the rise of agentic AI, with security product orders growing by a double-digit percentage last quarter.
At a forward P/E of 21, Cisco’s valuation is notably higher than that of Nvidia at 14.5 or Broadcom at 19, despite slower revenue growth, which may eventually push it out of value classifications.
Texas Instruments (TXN) rounds out the group with a nearly 50% year-to-date gain, serving industries including industrial, electronics, and automotive sectors alongside a growing AI-related business.
Within data centers, the company supplies power management chips and high-voltage hardware, with its data center segment expected to double this fiscal year on surging electrical demand from AI.
Texas Instruments is also seeing its industrial segment thrive, with that business posting 30% revenue growth last quarter on demand from factory automation and smart grids.
Trading at a forward P/E of 30, Texas Instruments is not cheap by most measures, but its cyclical business characteristics keep it classified within the value category.
Together, these three tech companies illustrate how value investing in 2026 does not necessarily mean avoiding innovation or high-growth sectors of the market.
