Just noticed something interesting happening in the markets that probably deserves more attention than it's getting. International stocks are finally having their moment after getting absolutely crushed by U.S. tech for years.

So here's what went down in 2025. The iShares EAFE ETF jumped 31.6% while the S&P 500 only managed 17.7%. Emerging markets ETF did even better at 34%. That's a pretty massive gap, and it's not really about people suddenly hating U.S. stocks — it's more that the rotation from growth into value is actually working, and the dollar weakened at the same time. When that happens, international stuff gets cheaper for foreign buyers and more attractive overall.

What's wild is that ETF flows are following this trend too. International and emerging market funds are pulling in new money at almost twice the rate of U.S. equity funds. That's a real signal that investors are starting to think differently.

Now here's where it gets interesting for looking at best international stocks going forward. The valuation story is pretty compelling. The S&P 500 is trading at around 29x forward earnings right now, which is genuinely expensive. Meanwhile, developed international markets sit at 19x and emerging markets at 18x. That gap hasn't always been this wide, and it usually doesn't stay that way forever.

Add in some other factors: European fiscal stimulus is kicking in, productivity is improving, and earnings growth expectations for 2026 are calling for solid single-digit to low double-digit growth across developed and emerging markets. Compare that to the near-stagnant earnings we saw in Europe last year. The fundamental case for best international stocks actually looks pretty reasonable right now.

There's also the diversification angle. A lot of international markets aren't nearly as tech-dependent as the U.S., so you're getting exposure to different sectors and economic cycles. That matters when you're trying to build a balanced portfolio.

Obviously there are risks. Geopolitical tensions are still a thing, tariff talk could derail growth, and if the dollar suddenly strengthens again, that becomes a headwind for foreign stocks relative to the S&P 500. Manufacturing slowdowns hit international economies harder too since they're more cyclically sensitive.

But here's the thing — U.S. stocks had basically one of the longest winning streaks since the financial crisis. At some point, that pendulum has to swing the other way. The fact that we're seeing it happen now, combined with better valuations and improving earnings expectations, suggests this might actually be more than just a one-year blip. If companies can actually deliver on those growth estimates, we could be looking at a genuinely interesting period for international investing and finding best international stocks that actually deliver.