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4 Stocks Trading Near 52-Week Highs That Can Climb Further
Stocks hitting their 52-week high and delivering consistent performance in the past few quarters offer attractive opportunities to investors while building a portfolio. This is because stocks near that level are perceived to be winners. However, stocks touching a new 52-week high are often predisposed to profit-taking, resulting in pullbacks and trend reversals.
Moreover, given the high price, investors often wonder if the stock is overpriced. While the speculations are not baseless, all stocks hitting a 52-week high are not necessarily overpriced.
In fact, investors might lose out on top gainers in an attempt to avoid the steep prices.
Stocks such as Super Micro Computer, HF Sinclair, Nine Energy Service and Thermon are expected to maintain the momentum and keep scaling new highs. More information on a stock is necessary to understand whether or not there is scope for further upside.
Here we discuss a strategy to find the right stocks. The strategy borrows from the basics of momentum investing. This technique bets on "buy high, sell higher."
52-Week High: A Good Indicator
Many a time, stocks hitting a 52-week high fail to scale higher despite having potential. This is because investors fear that the stocks are overvalued and expect the price to crash.
In fact, overvaluation is natural for most of these stocks as investors' focus (or willingness to pay a premium) has helped them reach the level. But that does not always indicate an impending decline. Factors such as robust sales, surging profit levels, earnings growth prospects and strategic acquisitions that encouraged investors to bet on these stocks could keep them motivated if there is no tangible negative. In other words, the momentum might continue.
Also, when a string of positive developments dominates the market, investors find their under-reaction unwarranted, even if there are no company-specific driving forces.
Here are our four picks of the 34 stocks that made it through the screen:
Super Micro Computer designs, develops, manufactures and sells energy-efficient, application-optimized server solutions based on the x86 architecture. SMCI's solutions include a range of rack mount and blade server systems as well as components. Super Micro Computer emphasizes superior product design and uncompromising quality control to produce industry-leading server boards, chassis and server systems.
The company currently sports a Zacks Rank of 1 and has a VGM Score of A. The Zacks Consensus Estimate for Super Micro's fiscal 2023 earnings has moved up 23.6% to $9.58 per share in the past 30 days. The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 9.42%.
HF Sinclair is an energy company, which produces and markets light products such as gasoline, diesel fuel, jet fuel, renewable diesel and other specialty products. HF Sinclair also owns and operates refineries located in Kansas, Oklahoma, New Mexico, Utah, Washington, and Wyoming and markets its refined products principally in the Southwest United States and the Rocky Mountains, Pacific Northwest, and other neighboring Plains states. HF Sinclair will continue to ramp up production of these assets as it expects to reach full production levels by the end of the third quarter.
The company currently sports a Zacks Rank of 1 and has a VGM Score of A. The Zacks Consensus Estimate for HF Sinclair's 2022 earnings has been revised upward by 8.6% to $15.61 per share in the past 30 days. The company surpassed the Zacks Consensus Estimate thrice in the trailing four quarters while missing the same on one occasion, the average surprise being 695.82%.
Nine Energy Service provides advanced technology and services to support complex wells in North America, and internationally. Its Scorpion frac plugs are performing pretty well, thereby boosting completion business revenues. The stock is well positioned to benefit from growth in coiled tubing services. Its highly engineered software provides better access to clients' coiled tubing operations. Its strong presence in major U.S. shale plays like Permian, Eagle Ford, Bakken, Marcellus and others bodes well for the company.
The company currently sports a Zacks Rank of 1 and has a VGM Score of B. The Zacks Consensus Estimate for Nine Energy Service's 2022 earnings has been revised upward to 57 cents per share from 4 cents per share in the past 30 days. The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 58.77%.
Thermon Holding is engaged in providing engineered thermal solutions, known as heat tracing, for process industries, including energy, chemical processing and power generation. Products offered by the company include heating cables, tubing bundles and control systems, while services offered by it include design optimization, engineering, installation and maintenance services. Its products provide an external heat source to pipes, vessels and instruments for the purposes of freeze protection, temperature and flow maintenance and environmental monitoring.
The company currently sports a Zacks Rank of 1 and has a VGM Score of B. The Zacks Consensus Estimate for Therman Holding's 2022 earnings has been revised upward by 19.5% to $1.35 per share in the past 30 days. The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 67.1%.
Get the rest of the stocks on the list and start putting this and other ideas to the test. It can all be done with the Research Wizard stock picking and back testing software.
The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your trial to the Research Wizard today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
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Zacks.com featured highlights include Super Micro Computer, HF Sinclair, Nine Energy Service and Thermon
For Immediate Release
Chicago, IL – November 21, 2022 – Stocks in this week’s article are Super Micro Computer (SMCI - Free Report) , HF Sinclair (DINO - Free Report) , Nine Energy Service (NINE - Free Report) and Thermon (THR - Free Report) .
4 Stocks Trading Near 52-Week Highs That Can Climb Further
Stocks hitting their 52-week high and delivering consistent performance in the past few quarters offer attractive opportunities to investors while building a portfolio. This is because stocks near that level are perceived to be winners. However, stocks touching a new 52-week high are often predisposed to profit-taking, resulting in pullbacks and trend reversals.
Moreover, given the high price, investors often wonder if the stock is overpriced. While the speculations are not baseless, all stocks hitting a 52-week high are not necessarily overpriced.
In fact, investors might lose out on top gainers in an attempt to avoid the steep prices.
Stocks such as Super Micro Computer, HF Sinclair, Nine Energy Service and Thermon are expected to maintain the momentum and keep scaling new highs. More information on a stock is necessary to understand whether or not there is scope for further upside.
Here we discuss a strategy to find the right stocks. The strategy borrows from the basics of momentum investing. This technique bets on "buy high, sell higher."
52-Week High: A Good Indicator
Many a time, stocks hitting a 52-week high fail to scale higher despite having potential. This is because investors fear that the stocks are overvalued and expect the price to crash.
In fact, overvaluation is natural for most of these stocks as investors' focus (or willingness to pay a premium) has helped them reach the level. But that does not always indicate an impending decline. Factors such as robust sales, surging profit levels, earnings growth prospects and strategic acquisitions that encouraged investors to bet on these stocks could keep them motivated if there is no tangible negative. In other words, the momentum might continue.
Also, when a string of positive developments dominates the market, investors find their under-reaction unwarranted, even if there are no company-specific driving forces.
Here are our four picks of the 34 stocks that made it through the screen:
Super Micro Computer designs, develops, manufactures and sells energy-efficient, application-optimized server solutions based on the x86 architecture. SMCI's solutions include a range of rack mount and blade server systems as well as components. Super Micro Computer emphasizes superior product design and uncompromising quality control to produce industry-leading server boards, chassis and server systems.
The company currently sports a Zacks Rank of 1 and has a VGM Score of A. The Zacks Consensus Estimate for Super Micro's fiscal 2023 earnings has moved up 23.6% to $9.58 per share in the past 30 days. The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 9.42%.
HF Sinclair is an energy company, which produces and markets light products such as gasoline, diesel fuel, jet fuel, renewable diesel and other specialty products. HF Sinclair also owns and operates refineries located in Kansas, Oklahoma, New Mexico, Utah, Washington, and Wyoming and markets its refined products principally in the Southwest United States and the Rocky Mountains, Pacific Northwest, and other neighboring Plains states. HF Sinclair will continue to ramp up production of these assets as it expects to reach full production levels by the end of the third quarter.
The company currently sports a Zacks Rank of 1 and has a VGM Score of A. The Zacks Consensus Estimate for HF Sinclair's 2022 earnings has been revised upward by 8.6% to $15.61 per share in the past 30 days. The company surpassed the Zacks Consensus Estimate thrice in the trailing four quarters while missing the same on one occasion, the average surprise being 695.82%.
Nine Energy Service provides advanced technology and services to support complex wells in North America, and internationally. Its Scorpion frac plugs are performing pretty well, thereby boosting completion business revenues. The stock is well positioned to benefit from growth in coiled tubing services. Its highly engineered software provides better access to clients' coiled tubing operations. Its strong presence in major U.S. shale plays like Permian, Eagle Ford, Bakken, Marcellus and others bodes well for the company.
The company currently sports a Zacks Rank of 1 and has a VGM Score of B. The Zacks Consensus Estimate for Nine Energy Service's 2022 earnings has been revised upward to 57 cents per share from 4 cents per share in the past 30 days. The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 58.77%.
Thermon Holding is engaged in providing engineered thermal solutions, known as heat tracing, for process industries, including energy, chemical processing and power generation. Products offered by the company include heating cables, tubing bundles and control systems, while services offered by it include design optimization, engineering, installation and maintenance services. Its products provide an external heat source to pipes, vessels and instruments for the purposes of freeze protection, temperature and flow maintenance and environmental monitoring.
The company currently sports a Zacks Rank of 1 and has a VGM Score of B. The Zacks Consensus Estimate for Therman Holding's 2022 earnings has been revised upward by 19.5% to $1.35 per share in the past 30 days. The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 67.1%.
Get the rest of the stocks on the list and start putting this and other ideas to the test. It can all be done with the Research Wizard stock picking and back testing software.
The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your trial to the Research Wizard today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.
Click here to sign up for a free trial to the Research Wizard today.
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2019745/4-stocks-trading-near-52-week-high-that-can-climb-further
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.
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Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Contact: Jim Giaquinto
Company: Zacks.com
Phone: 312-265-9268
Email: pr@zacks.com
Visit: https://www.zacks.com/
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.