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Take the Zacks Approach to Beat the Market: Axon, Rollins, Starbucks in Focus
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The three most widely followed indexes closed last week lower after making big gains the week before, continuing a tumultuous November. The S&P 500 and the tech-heavy Nasdaq slid 0.7% and 1.6%, respectively. The Dow Jones Industrial Average remained virtually flat.
The gains logged in the week before on the back of an encouraging CPI report were given up last week. Market participants tried to digest the reality that the Fed will not be drastically slowing down its pace of interest rate hikes in the coming months but will instead take a more measured approach. Various comments from key Fed officials sent mixed signals to the market about the likely level of relaxation in rates.
Even as the overwhelming consensus remains that the string of 75 bps rate hikes would come to an end in the Fed’s December meeting, a 50 bps hike is still expected. This is high enough for investors to remain apprehensive that the Fed would not be able to achieve a soft landing. Escalations in the Ukraine war also contributed to the gloom that hung over Wall Street last week.
Regardless of market conditions, we, here at Zacks, provide investors with unbiased guidance on how to beat the market.
As usual, Zacks Research guided investors over the past three months with its time-tested methodologies. Given the prevailing market uncertainty, you may want to look at our feats to prepare better for your next action.
Here are some of our key achievements:
NBT Bancorp, First Merchants Soar Following Zacks Rank Upgrade
Shares of NBT Bancorp Inc. (NBTB - Free Report) have surged 23% since it was upgraded to a Zacks Rank #2 (Buy) on September 7.
Another stock, First Merchants Corporation (FRME - Free Report) , was upgraded to a Zacks Rank #2 on September 8 and has returned 9.6% since then.
Zacks Rank, our short-term rating system, has earnings estimate revisions at its core. Empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
This stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally audited track record, with Zacks Rank #1 stocks generating an average annual return of +24.8% since 1988.You can see the complete list of today’s Zacks Rank #1 stocks here >>>
Zacks Recommendation Upgrade Drives First Business Financial and Pure Storage Higher
Shares of First Business Financial Services, Inc. (FBIZ - Free Report) and Pure Storage, Inc. (PSTG - Free Report) have gained 16.6% and 8.9% since their Zacks Recommendation was upgraded to Outperform on August 29 and September 2, respectively.
While the Zacks Rank is our short-term rating system that is most effective over the one- to three-month holding horizon, the Zacks Recommendation aims to predict performance over the next 6 to 12 months. However, just like the Zacks Rank, the foundation for the Zacks Recommendation is trends in earnings estimate revisions.
The Zacks Recommendation classifies stocks into three groups — Outperform, Neutral and Underperform. While these recommendations are determined quantitatively, our analysts have the flexibility to override them for the 1100+ stocks they closely follow based on their better judgment of factors such as valuation, industry conditions and management effectiveness than the quantitative model.
To access our research reports with Zacks Recommendations for the 1100+ stocks we cover, click here>>>
Zacks Focus List Model Portfolio Axon, Walmart Soar High
Shares of Axon Enterprise, Inc. (AXON - Free Report) , which belongs to the Zacks Focus List, have surged 45.1% over the past 12 weeks. The stock was added to the Focus List on June 3, 2020. Another Focus-List holding, Walmart Inc. (WMT - Free Report) , which was added to the portfolio on May 30,2017, has returned 10.6% over the past 12 weeks.
The Zacks Focus List is a model portfolio of 50 hand-picked stocks that possess the right fundamental ingredients to outperform the market over the next 12 months. These 50 stocks are picked from a long list of stocks with the highest Zacks Rank.
Since its inception on February 1, 1996, the Focus List portfolio has delivered an annualized return of +12.9%.
Unlock all of our powerful research, tools and analysis, including the Focus List, Zacks #1 Rank List, Equity Research Reports, Zacks Earnings ESP Filter, Premium Screener and more, as part of Zacks Premium. Gain full access now >>
Rollins, Inc. (ROL - Free Report) , a component of our Earnings Certain Admiral Portfolio (ECAP), jumped 19% over the past 12 weeks. Amgen Inc. (AMGN - Free Report) followed Rollins with 16.9% returns.
ECAP is a model portfolio of 30 concentrated, ultra-defensive, long-term Buy and Hold stocks.
With little to no turnover and annual rebalance periodicity, the ECAP seeks to minimize capital loss by holding shares of companies whose earnings streams exhibit a proven 20+ year track record of surviving recessionary periods with minimal impact on aggregate earnings growth relative to the overall S&P 500.
The ECAP and many other model portfolios are available as part of Zacks Advisor Tools, a cloud-based solution to access Zacks award-winning stock, mutual fund and ETF research. Click here to schedule a demo.
Zacks ECDP Stocks Starbucks, Illinois Tool Works Outperform Peers
Starbucks Corporation (SBUX - Free Report) , which is part of our Earnings Certain Dividend Portfolio (ECDP), has returned 12.1% over the past 12 weeks. Another ECDP stock, Illinois Tool Works Inc. (ITW - Free Report) , has climbed 9.2% over the same time frame. Of course, the inclination of investors toward quality dividend stocks to secure an income stream amid the heightened market volatility contributed to this performance.
With an extremely low Beta and a history of minimum earnings variability over the last 20+ years, this 25-stock portfolio helps significantly mitigate risk. The ECDP has consistently outperformed the S&P 500 Dividend Aristocrats ETF (NOBL - Free Report) .
Image: Bigstock
Take the Zacks Approach to Beat the Market: Axon, Rollins, Starbucks in Focus
The three most widely followed indexes closed last week lower after making big gains the week before, continuing a tumultuous November. The S&P 500 and the tech-heavy Nasdaq slid 0.7% and 1.6%, respectively. The Dow Jones Industrial Average remained virtually flat.
The gains logged in the week before on the back of an encouraging CPI report were given up last week. Market participants tried to digest the reality that the Fed will not be drastically slowing down its pace of interest rate hikes in the coming months but will instead take a more measured approach. Various comments from key Fed officials sent mixed signals to the market about the likely level of relaxation in rates.
Even as the overwhelming consensus remains that the string of 75 bps rate hikes would come to an end in the Fed’s December meeting, a 50 bps hike is still expected. This is high enough for investors to remain apprehensive that the Fed would not be able to achieve a soft landing. Escalations in the Ukraine war also contributed to the gloom that hung over Wall Street last week.
Regardless of market conditions, we, here at Zacks, provide investors with unbiased guidance on how to beat the market.
As usual, Zacks Research guided investors over the past three months with its time-tested methodologies. Given the prevailing market uncertainty, you may want to look at our feats to prepare better for your next action.
Here are some of our key achievements:
NBT Bancorp, First Merchants Soar Following Zacks Rank Upgrade
Shares of NBT Bancorp Inc. (NBTB - Free Report) have surged 23% since it was upgraded to a Zacks Rank #2 (Buy) on September 7.
Another stock, First Merchants Corporation (FRME - Free Report) , was upgraded to a Zacks Rank #2 on September 8 and has returned 9.6% since then.
Zacks Rank, our short-term rating system, has earnings estimate revisions at its core. Empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
This stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally audited track record, with Zacks Rank #1 stocks generating an average annual return of +24.8% since 1988.You can see the complete list of today’s Zacks Rank #1 stocks here >>>
Check NBT Bancorp’s historical EPS and Sales here>>>
Check First Merchants’ historical EPS and Sales here>>>
Image Source: Zacks Investment Research
Zacks Recommendation Upgrade Drives First Business Financial and Pure Storage Higher
Shares of First Business Financial Services, Inc. (FBIZ - Free Report) and Pure Storage, Inc. (PSTG - Free Report) have gained 16.6% and 8.9% since their Zacks Recommendation was upgraded to Outperform on August 29 and September 2, respectively.
While the Zacks Rank is our short-term rating system that is most effective over the one- to three-month holding horizon, the Zacks Recommendation aims to predict performance over the next 6 to 12 months. However, just like the Zacks Rank, the foundation for the Zacks Recommendation is trends in earnings estimate revisions.
The Zacks Recommendation classifies stocks into three groups — Outperform, Neutral and Underperform. While these recommendations are determined quantitatively, our analysts have the flexibility to override them for the 1100+ stocks they closely follow based on their better judgment of factors such as valuation, industry conditions and management effectiveness than the quantitative model.
To access our research reports with Zacks Recommendations for the 1100+ stocks we cover, click here>>>
Zacks Focus List Model Portfolio Axon, Walmart Soar High
Shares of Axon Enterprise, Inc. (AXON - Free Report) , which belongs to the Zacks Focus List, have surged 45.1% over the past 12 weeks. The stock was added to the Focus List on June 3, 2020. Another Focus-List holding, Walmart Inc. (WMT - Free Report) , which was added to the portfolio on May 30,2017, has returned 10.6% over the past 12 weeks.
The Zacks Focus List is a model portfolio of 50 hand-picked stocks that possess the right fundamental ingredients to outperform the market over the next 12 months. These 50 stocks are picked from a long list of stocks with the highest Zacks Rank.
Since its inception on February 1, 1996, the Focus List portfolio has delivered an annualized return of +12.9%.
Unlock all of our powerful research, tools and analysis, including the Focus List, Zacks #1 Rank List, Equity Research Reports, Zacks Earnings ESP Filter, Premium Screener and more, as part of Zacks Premium. Gain full access now >>
Zacks ECAP Stocks Rollins, Amgen Deliver Solid Returns
Rollins, Inc. (ROL - Free Report) , a component of our Earnings Certain Admiral Portfolio (ECAP), jumped 19% over the past 12 weeks. Amgen Inc. (AMGN - Free Report) followed Rollins with 16.9% returns.
ECAP is a model portfolio of 30 concentrated, ultra-defensive, long-term Buy and Hold stocks.
With little to no turnover and annual rebalance periodicity, the ECAP seeks to minimize capital loss by holding shares of companies whose earnings streams exhibit a proven 20+ year track record of surviving recessionary periods with minimal impact on aggregate earnings growth relative to the overall S&P 500.
The ECAP and many other model portfolios are available as part of Zacks Advisor Tools, a cloud-based solution to access Zacks award-winning stock, mutual fund and ETF research. Click here to schedule a demo.
Zacks ECDP Stocks Starbucks, Illinois Tool Works Outperform Peers
Starbucks Corporation (SBUX - Free Report) , which is part of our Earnings Certain Dividend Portfolio (ECDP), has returned 12.1% over the past 12 weeks. Another ECDP stock, Illinois Tool Works Inc. (ITW - Free Report) , has climbed 9.2% over the same time frame. Of course, the inclination of investors toward quality dividend stocks to secure an income stream amid the heightened market volatility contributed to this performance.
Check Starbucks’ dividend history here>>>
Check Illinois Tool Works’ dividend history here>>>
With an extremely low Beta and a history of minimum earnings variability over the last 20+ years, this 25-stock portfolio helps significantly mitigate risk. The ECDP has consistently outperformed the S&P 500 Dividend Aristocrats ETF (NOBL - Free Report) .
Click here to access this portfolio on Zacks Advisor Tools.