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Find 'Strong Buy' Stocks as the S&P 500 and the Nasdaq Hit 52-Week Highs
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Wall Street reacted to May’s CPI release on Tuesday morning by sending stocks even higher, pushing both the S&P 500 and the Nasdaq to fresh 52-week highs. The inflation data came in almost exactly in line with Wall Street projections and marked the continuation of cooling prices that has Wall Street at its seemingly most bullish levels of the year.
Prices rose 4.0% in May to match Wall Street forecasts and mark a solid drop from April’s 4.9%. The latest figures marked the smallest 12-month increase since March 2021, and they have been more than cut in half vs. the June 2022 peaks.
On a monthly basis, prices popped 0.1% vs. 0.4% in April. Core CPI, which strips out food and energy costs, hit 5.3% vs. the market’s 5.5% projections. Inflation is still far above the Fed’s 2% floating target range, but Wall Street is a forward-looking world and investors are nearly certain prices will keep edging closer to those target levels.
Wall Street upped its bets on a Fed pause to 97% following the Tuesday morning release, up from 79% yesterday. The Fed will make its move official tomorrow. If Jay Powell and Co. do indeed leave rates unchanged on Wednesday and continue their more dovish tones, the market could crank up the bullishness.
There is room to run since both the S&P 500 and the Nasdaq trade well beneath their all-time records. Plus, many other areas of the market are finally starting to participate in the rally, not just mega-cap tech.
With this in mind, investors can utilize the Filtered Zacks Rank 5 Stock Screen to help find potentially winning stocks for June and beyond that have boosted their earnings guidance as the bulls push stocks higher.
Zacks Rank #1 (Strong Buy) stocks outperform the market in both good and bad times. However, there are over 200 stocks that earn a Zacks Rank #1 at any given time. Therefore, it’s helpful to understand how to apply filters to the Zacks Rank in order to narrow the list down to a more manageable and tradable set of stocks.
Parameters
Clearly, there are only three items on this screen. But together, these three filters can result in some impressive returns.
• Zacks Rank equal to 1
Starting with a Zacks Rank #1 is often a strong jumping off point because it boasts an average annual return of roughly 24.4% per year since 1988.
• % Change (Q1) Est. over 4 Weeks greater than 0
Positive current quarter estimate revisions over the last four weeks.
• % Broker Rating Change over 4 Week equal to Top # 5
Top 5 stocks with the best average broker rating changes over the last four weeks.
This strategy comes loaded with the Research Wizard and is called bt_sow_filtered zacks rank5. It can be found in the SoW (Screen of the Week) folder.
Here are two of the five stocks that qualified for the Filtered Zacks Rank 5 strategy today…
Enersys (ENS)
EnerSys provides stored energy solutions for industrial applications. EnerSys and its wide-ranging portfolio features motive power, reserve power, and specialty batteries, alongside a range of integrated services and systems. EnerSys and its array of offerings service industries such as telecommunication, utilities, industrial, aerospace and defense, automotive, and more.
EnerSys beat our Q4 FY23 earnings and revenue estimates in late May and upped its guidance. ENS is set to benefit from “global megatrends including electrification, decarbonization and automation drive increased demand for energy storage, EnerSys is well-positioned to deliver the solutions that our customers need.”
Image Source: Zacks Investment Research
Zacks estimates call for its revenue to climb by 5% this year and over 4% next year to help boost its adjusted earnings by 28% and 20%, respectively. EnerSys’ earnings outlook has continued to improve to help it land a Zacks Rank #1 (Strong Buy) right now.
ENS is part of the Zacks Manufacturing – Electronics unit that ranks in the 10% of all our industries right now. EnerSys stock has surged over 40% in 2023 and 70% in the past 12 months, including a big post-earnings release jump that has it solidly above its 50-day moving average. ENS hit fresh records on Tuesday. And EnerSys is still trading at a 30% discount to its five-year highs at 14.8X forward earnings.
Nvidia is a chip superstar that’s expanded its reach far beyond gaming into data centers and more. The GPU titan has skyrocketed to fresh record highs on the back of its ability to benefit from the booming world of artificial intelligence.
Wall Street analysts can hardly keep up with Nvidia’s beefed up, AI-boosted guidance, with both its current full-year and next year’s earnings outlook up roughly 70% since its May release to help it land a Zacks Rank #1 (Strong Buy).
Nvidia’s revenue is projected to grow by 58% this year and another 28% next year, based on Zacks estimates. Meanwhile, its adjusted earnings are projected to skyrocket by 129% and 33%, respectively. On top of that 27 of the 34 brokerage recommendations Zacks has for NVDA are “Strong Buys,” alongside four “Buys,” and the rest “Holds.”
Image Source: Zacks Investment Research
Even though Nvidia has soared 180% so far this year and it is at brand-new all-time highs, NVDA trades 9% below the current average Zacks price target. NVDA has also climbed over 11,200% in the last decade to absolutely destroy the Zacks tech sector’s 260%.
Some investors might be nervous about “chasing” Nvidia here. But its valuation levels are actually not too far from its five-year median at 55X forward earnings. These valuation levels also mark a 50% discount vs. its own highs. The nearby chart highlights just how impressive its updated earnings outlook is right now.
Get the rest of the stocks on this list and start looking for the newest companies that fit these criteria. It's easy to do. And it could help you find your next big winner. Start screening for these companies today with a free trial to the Research Wizard. You can do it.
Want more articles from this author? Scroll up to the top of this article and click the FOLLOW AUTHOR button to get an email each time a new article is published.
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.
Image: Bigstock
Find 'Strong Buy' Stocks as the S&P 500 and the Nasdaq Hit 52-Week Highs
Wall Street reacted to May’s CPI release on Tuesday morning by sending stocks even higher, pushing both the S&P 500 and the Nasdaq to fresh 52-week highs. The inflation data came in almost exactly in line with Wall Street projections and marked the continuation of cooling prices that has Wall Street at its seemingly most bullish levels of the year.
Prices rose 4.0% in May to match Wall Street forecasts and mark a solid drop from April’s 4.9%. The latest figures marked the smallest 12-month increase since March 2021, and they have been more than cut in half vs. the June 2022 peaks.
On a monthly basis, prices popped 0.1% vs. 0.4% in April. Core CPI, which strips out food and energy costs, hit 5.3% vs. the market’s 5.5% projections. Inflation is still far above the Fed’s 2% floating target range, but Wall Street is a forward-looking world and investors are nearly certain prices will keep edging closer to those target levels.
Wall Street upped its bets on a Fed pause to 97% following the Tuesday morning release, up from 79% yesterday. The Fed will make its move official tomorrow. If Jay Powell and Co. do indeed leave rates unchanged on Wednesday and continue their more dovish tones, the market could crank up the bullishness.
There is room to run since both the S&P 500 and the Nasdaq trade well beneath their all-time records. Plus, many other areas of the market are finally starting to participate in the rally, not just mega-cap tech.
With this in mind, investors can utilize the Filtered Zacks Rank 5 Stock Screen to help find potentially winning stocks for June and beyond that have boosted their earnings guidance as the bulls push stocks higher.
Zacks Rank #1 (Strong Buy) stocks outperform the market in both good and bad times. However, there are over 200 stocks that earn a Zacks Rank #1 at any given time. Therefore, it’s helpful to understand how to apply filters to the Zacks Rank in order to narrow the list down to a more manageable and tradable set of stocks.
Parameters
Clearly, there are only three items on this screen. But together, these three filters can result in some impressive returns.
• Zacks Rank equal to 1
Starting with a Zacks Rank #1 is often a strong jumping off point because it boasts an average annual return of roughly 24.4% per year since 1988.
• % Change (Q1) Est. over 4 Weeks greater than 0
Positive current quarter estimate revisions over the last four weeks.
• % Broker Rating Change over 4 Week equal to Top # 5
Top 5 stocks with the best average broker rating changes over the last four weeks.
This strategy comes loaded with the Research Wizard and is called bt_sow_filtered zacks rank5. It can be found in the SoW (Screen of the Week) folder.
Here are two of the five stocks that qualified for the Filtered Zacks Rank 5 strategy today…
Enersys (ENS)
EnerSys provides stored energy solutions for industrial applications. EnerSys and its wide-ranging portfolio features motive power, reserve power, and specialty batteries, alongside a range of integrated services and systems. EnerSys and its array of offerings service industries such as telecommunication, utilities, industrial, aerospace and defense, automotive, and more.
EnerSys beat our Q4 FY23 earnings and revenue estimates in late May and upped its guidance. ENS is set to benefit from “global megatrends including electrification, decarbonization and automation drive increased demand for energy storage, EnerSys is well-positioned to deliver the solutions that our customers need.”
Image Source: Zacks Investment Research
Zacks estimates call for its revenue to climb by 5% this year and over 4% next year to help boost its adjusted earnings by 28% and 20%, respectively. EnerSys’ earnings outlook has continued to improve to help it land a Zacks Rank #1 (Strong Buy) right now.
ENS is part of the Zacks Manufacturing – Electronics unit that ranks in the 10% of all our industries right now. EnerSys stock has surged over 40% in 2023 and 70% in the past 12 months, including a big post-earnings release jump that has it solidly above its 50-day moving average. ENS hit fresh records on Tuesday. And EnerSys is still trading at a 30% discount to its five-year highs at 14.8X forward earnings.
Nvidia ((NVDA - Free Report) )
Nvidia is a chip superstar that’s expanded its reach far beyond gaming into data centers and more. The GPU titan has skyrocketed to fresh record highs on the back of its ability to benefit from the booming world of artificial intelligence.
Wall Street analysts can hardly keep up with Nvidia’s beefed up, AI-boosted guidance, with both its current full-year and next year’s earnings outlook up roughly 70% since its May release to help it land a Zacks Rank #1 (Strong Buy).
Nvidia’s revenue is projected to grow by 58% this year and another 28% next year, based on Zacks estimates. Meanwhile, its adjusted earnings are projected to skyrocket by 129% and 33%, respectively. On top of that 27 of the 34 brokerage recommendations Zacks has for NVDA are “Strong Buys,” alongside four “Buys,” and the rest “Holds.”
Image Source: Zacks Investment Research
Even though Nvidia has soared 180% so far this year and it is at brand-new all-time highs, NVDA trades 9% below the current average Zacks price target. NVDA has also climbed over 11,200% in the last decade to absolutely destroy the Zacks tech sector’s 260%.
Some investors might be nervous about “chasing” Nvidia here. But its valuation levels are actually not too far from its five-year median at 55X forward earnings. These valuation levels also mark a 50% discount vs. its own highs. The nearby chart highlights just how impressive its updated earnings outlook is right now.
Get the rest of the stocks on this list and start looking for the newest companies that fit these criteria. It's easy to do. And it could help you find your next big winner. Start screening for these companies today with a free trial to the Research Wizard. You can do it.
Click here to sign up for a free trial to the Research Wizard today.
Want more articles from this author? Scroll up to the top of this article and click the FOLLOW AUTHOR button to get an email each time a new article is published.
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.
Disclosure: Performance information for Zacks’ portfolios and strategies are available at: https://www.zacks.com/performance/