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These stocks will make a comeback in 2016: Analyst

Investors in 2015 were betting on mega-cap companies with stability, looking for confident growth, said Stephen DeNichilo, portfolio manager at Federated.

"Take that theme and you look for companies that actually executed in 2015 and, for whatever reason, fell awry, and the stocks didn't perform that well," he said Monday on CNBC's "Power Lunch."

DeNichilo considers Sherwin-Williams and Whirlpool to be two stocks that were left behind in 2015 but are poised for a comeback this year.

Some market watchers worry about Whirlpool's business in Latin America in the face of a weakened economy, coupled with the Fed raising interest rates.

But DeNichilo argues that Latin American makes up 10 percent of Whirlpool's business, and even with those variables present in 2016, he expects to see 15 to 20 percent growth.

"The stock is at $143. This is a very very cheap stock, underfollowed and underowned and [it] really will have a lot of catalyst going into 2016," he said. The stock sank 26 percent last year.

In the third quarter, Sherwin-Williams beat Zack's consensus estimate with the earnings coming in at $3.97 per share, compared with the estimated $3.89 per share. However, the paint manufacturing company missed in revenue.

Although the company faced weather issues during the second and third quarters, Sherwin-Williams managed a 25 percent earnings growth rate, the analyst said.

"In 2016, I expect an excess of 20 percent earnings growth, again," DeNichilo said. "In all S&P 500 companies over the last 20 years they have the second-fastest dividend growth, they are a cash-flow machine, they generate more free cash flow than net income."

Correction: An earlier version misstated Whirlpool's year-to-date performance.