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Strong Stocks In A Strong Sector

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Sticking with what works has been a personal investing theme of mine.  Basically the idea is to look for stocks in strong sectors that have been moving higher.  Select the ones that continue to look to be moving higher and let your winners ride.

This is a sort of “top down” style move, but I find that it works very well.  The first step is to look at the Zacks Industry Rank and look towards the top. This week saw little movement at the very top with Metal Products – Fasteners staying at the very top and then seven other industries tied for second.

I moved down to #14 on the list as we have seen lots of articles about banks and semiconductors of late.  The sector I am looking at is Computer- Storage Devices and there are 10 stocks in that group.

#1’s First

Now that I have my pool of candidates, I switch to the Zack Rank to help me select the best picks.  The Zacks Rank let’s me know which stocks in the industry have seen positive earnings estimate revisions.  For a fundamental investor such as myself, I know that earnings are a key driver for stock prices.

The industry has three stocks with a Zacks Rank #1 (Strong Buy) rating.

NetApp ((NTAP - Free Report) )

Seagate Tech ((STX - Free Report) )

Western Digital (WDC)

Seagate Technology PLC Price, Consensus and EPS Surprise

Seagate Technology PLC Price, Consensus and EPS Surprise | Seagate Technology PLC Quote

One #2

There is one stock with a Zacks Rank #2 (Buy) rating.

Pure Storage ((PSTG - Free Report) )

Pure Storage Inc. Price, Consensus and EPS Surprise

Pure Storage Inc. Price, Consensus and EPS Surprise | Pure Storage Inc. Quote

Two Others To Watch

One of the stocks in this sector is Nimble Storage () and it has a Zacks Rank #3 (Hold).  Most of the stocks that Zacks ranks are #3’s but this one stands out a little to me. There is a 60 day window during which estimate revisions can impact the Zacks Rank and time is running out (or has run out) for 3 positive revisions to 2017 and 2 positive revisions to 2018. 

                                                   Follow Brian Bolan on Twitter: @BBolan1

The other stock to watch that isn’t listed as part of this sector, but instead is part of the Internet – Software sector is Box Inc ((BOX - Free Report) ).  The stock hold a Zacks Rank #2 (Buy) and has been close to or making new 52 week highs of late.

 

Box Inc. Price and Consensus

Box Inc. Price and Consensus | Box Inc. Quote

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