Tom Lee, the co-founder of Fundstrat Global Advisors Llc. who forecasts stocks will fall from current levels by year-end, said investors should consider buying five companies that are out of favor among most Wall Street analysts.

The bottom 20 percent "least liked" stocks showed higher gains than the "most liked" 20 percent of 7.4 percentage points last year, the strategist said in a report.

"In 2017 so far, equities have been very strong,” Lee wrote. “However, in coming weeks, equities may be facing some headwinds.”

The S&P 500 has risen 11 percent to record highs since Donald Trump was elected on campaign pledges to cut taxes and regulation. Lee foresees the stock benchmark declining about 4 percent from its current level of about 2,380 to 2,275 by the end of the year.

Rate hikes by the Federal Reserve, which this week raised its target rate for the third time in the past 11 years, will work against stocks, according to Lee’s analysis. Stocks historically have fallen 2.2 percent on average in the three months after a third rate hike since 1971.

Another worrisome sign for stocks is the sell-off in junk bonds as investors seek out higher risk-free returns from Treasurys.

“We continue to view high-yield as leading the equities market," Lee said.

Lee’s five out-of-favor stocks are:

Name (Ticker), Dividend Yield

1. Equity Residential (EQR) 3.4%
2. Exxon Mobil (XOM) 3.9%
3. Staples (SPLS) 5.7%
4. Teradata (TDC) 0%
5. Xilinx (XLNX) 2.3%

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