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5 Easy Money Momentum Stocks To Buy Now

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With a New Year comes plenty of new opportunity to make money in the stock market. We can only hope that the next couple of months go as smoothly as the previous two have. But we all know that it’s never that easy so I expect to see plenty of up and down action in this market over the coming months.

There is one thing that remains constant throughout any market condition. That is that the hottest stocks of the market are going to be the ones that are making new highs. After breaking out from previous resistance, stocks tend to keep on pushing through to new levels as investors reprice the risk associated with the stock.

There are a number of reasons why a stock may be breaking out to new highs that are directly correlated to earnings estimates. It could be because of earnings estimates moving higher, earnings growth increasing or a fantastic earnings report with an upside surprise. Our Zacks Rank and Zacks Momentum Style Score helps uncover momentum stocks that are breaking higher for precisely these reasons. By looking for stocks that are Zacks Rank #1 (Strong Buy) and Zacks Rank #2 (Buy) stocks with Momentum Style Scores of A or B you can these momentum stocks.

Here I’ve put together a list of five stocks breaking through to new highs with some serious earnings action helping propel them higher. Two of these names are retail brokers, one is an energy name, one in the steel business and the other is a drug company. A nice scattering of stocks across multiple industries providing several ideas.

TD Ameritrade (AMTD - Free Report)

TD Ameritrade Holding Corporation provides securities brokerage services and related technology-based financial services to retail investors, traders, and independent registered investment advisors (RIAs) in the United States.

Shares of AMTD have rocketed higher since bottoming out near $26 in early July. A steady incline has met little resistance along the way with the stock pulling back below the 20-day moving average for only a handful of days. The Commodity Channel Index (CCI) has remained bullish above the zero line for most of the last two months save for a quick dip below as shares pulled back late last week. The stock is now breaking out to new highs and could hit $50 in the new few days.

Charles Schwab (SCHW - Free Report)

The Charles Schwab Corporation, through its subsidiaries, provides wealth management, securities brokerage, banking, money management, custody, and financial advisory services. The company operates through two segments, Investor Services and Advisor Services. 

In the same business as TD Ameritrade, Schwab has benefited from rising rates and a hot stock market as well. The story here is very similar, although there have been two longer consolidation periods sandwiched between sharp moves for the stock on earnings. Recently, the slower uptrend from $36 to $40 has been a steady accumulation, lacking the breakout pop of AMTD. I’d wait for a pullback to the 20-day to jump on board.

AK Steel

AK Steel Holding Corporation, through its subsidiary, AK Steel Corporation, produces flat-rolled carbon, stainless and electrical steel, and tubular products in the United States and internationally. It produces flat-rolled value-added carbon steels, including coated, cold-rolled, and hot-rolled carbon steel products; and specialty stainless and electrical steels in sheet and strip forms. 

Part of the “Trump Trade” AK Steel shares have really taken off following the election. The pattern lately looks to be running out of steam a little bit just south of the 50-week high in the low $11s. If you note the higher lows that have been put in over the last couple of weeks, it lends itself to a breakout to the upside in the short term. I’d buy a breakout of the highs here rather than adding now and hoping there is a move.

Halliburton (HAL - Free Report)

Halliburton Company provides a range of services and products to the upstream oil and natural gas industry worldwide. The company’s Completion and Production segment offers production enhancement services, including stimulation and sand control services; and cementing services, such as bonding the well, well casing, and casing equipment.

Shares of HAL have seen a slow, steady accumulation since the September lows. While this name certainly is tied to a resurgence in the energy industry, it’s been a strong momentum name for a very long time. It’s breaking out to new highs right now and is something I’d be looking to add a positon in when you consider the lower comps the entire sector is going to face coming into Q4 earnings. I think this will be one of the strongest stocks over the next few months.

Zoetis (ZTS - Free Report)

Zoetis Inc. engages in the discovery, development, manufacture, and commercialization of animal health medicines and vaccines for livestock and companion animals in the United States and internationally. It offers anti-infectives that prevent, kill, or slow the growth of bacteria, fungi, or protozoa; vaccines, which are biological preparations to prevent diseases of the respiratory, gastrointestinal, and reproductive tracts or induce a specific immune response; and parasiticides that prevent or eliminate external and internal parasites, such as fleas, ticks, and worms. 

This stock has been all over the place, chopping in a large range the second half of last year. An extended consolidation period throughout last spring led to a breakout to a new range. The top of that previous range in the low $50s is exactly where the stock is trading right now. I’d wait for the CCI to come back down closer to the zero line to initiate a positon.

Bottom Line

You don’t have to re-invent the wheel every year. What worked last year fundamentally should work this year. That is looking for stocks that are breaking out for earnings reasons, not just on speculation. If you can find names with solid earnings stories and estimate revisions increasing that are also breaking out on a technical level then you can uncover some real winners for yourself in 2017.

Zacks' Top 10 Stocks for 2017

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