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7 Stocks with Recent Price Strength for Your Portfolio
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In the stock game, winning means reaching a higher price.
However, finding a win-win strategy is easier said than done. In the current highly volatile market, it is difficult for even an ardent investor to come up with a foolproof approach.
One could resort to commonly used techniques to find beaten down stocks that have the potential to recover faster than others. But this bears the risk of disappointment. Particularly, one could get stuck in the value trap if the hidden weaknesses in selected stocks are not identified.
So, wouldn’t it be safer to look for stocks that are winners currently and have the potential to gain further?
If you are convinced of this strategy, here’s how to execute it:
One should primarily look for stocks that have recently been witnessing a price increase. Actually, stocks backed by recent price strength have a high chance of carrying the momentum forward.
If a stock is continuously moving higher, there must be a good reason for the rise or else it probably would have fallen or remained stable. So, looking at stocks that have already won the game and are capable of beating the benchmark that they have set themselves sounds rational.
However, recent price strength alone cannot create magic. So you need to set other relevant parameters for a successful investment strategy.
Here’s how you should create the screen to shortlist current as well as potential winners.
Screening Parameters:
Percentage Change in Price (4 Weeks) greater than zero: This criterion shows that the stock moved higher in the last four weeks.
Percentage Change Price (12 Weeks) greater than 10: This indicates that the stock saw momentum over the last three months. This lowers the risk of choosing stocks that may have drawn attention due to the overwhelming performance of the overall market in a very short span.
Zacks Rank 1: No matter whether the market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) have a proven history of outperformance.
Average Broker Rating 1: This indicates that brokers are also highly hopeful about the stock’s future performance.
Current Price greater than 5: The stocks must all be trading at a minimum of $5 or higher.
Current Price/52-Week High-Low Range more than 85%: This criterion filters stocks that are trading near their respective 52-week highs. This indicates that these are strong enough in terms of price.
Here are seven of the 13 stocks that made it through this screen:
Innospec Inc. (IOSP - Free Report) , formerly known as Octel Corp., is a major manufacturer and distributor of fuel additives and other specialty chemicals. Their products are sold globally, primarily to oil refineries. The company surpassed the Zacks Consensus Estimate in each of the preceding four quarters, with an average positive surprise of 15.2%.
HomeStreet, Inc. (HMST - Free Report) is a diversified financial services company. It is engaged in real estate lending, including mortgage banking activities and retail and business banking operations, and serves consumers and businesses in the Pacific Northwest and Hawaii. The company beat the Zacks Consensus Estimate thrice in the preceding four quarters, with an average positive surprise of 17.3%.
Gibraltar Industries, Inc. (ROCK - Free Report) is a leading manufacturer, processor and distributor of metals and other engineered materials for the building products, vehicular, and other industrial markets. The company surpassed the Zacks Consensus Estimate in each of the preceding four quarters, with an average positive surprise of 74.5%.
PCM Inc. is a technology solutions provider to businesses, government and educational institutions and individual consumers. It offers technology products and solutions as well as consumer electronics equipment and other consumer products. The company surpassed the Zacks Consensus Estimate in the last two quarters, with an average positive surprise of 43.5%.
Horizon Global Corporation is a designer, manufacturer and distributor of towing, trailering, cargo management and accessory products for original equipment, aftermarket and retail customers. The company surpassed the Zacks Consensus Estimate in the last two quarters, with an average positive surprise of 75.8%.
Ducommun Incorporated (DCO - Free Report) manufactures components and assemblies principally for domestic and foreign commercial and military aircraft and space programs. Ducommun is a subcontractor to Lockheed Martin on the Space Shuttle external tank and a supplier of components for Space Shuttle and the International Space Station. Last quarter, the company posted a positive earnings surprise of 21.4%.
KT Corporation (KT - Free Report) provides telecommunication services. Its services include mobile telecommunications services, telephone services, fixed-line and VoIP telephone services. The company also provides interconnection services to other telecommunications’ companies, broadband Internet access services and other Internet-related services. It also offers information technology and network services, including consulting, designing, building, and maintaining of systems and communication networks.
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 backtesting 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 Research Wizard trial 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.
Zacks Restaurant Recommendations: In addition to dining at these special places, you can feast on their stock shares. A Zacks Special Report spotlights 5 recent IPOs to watch plus 2 stocks that offer immediate promise in a booming sector. Download it free »
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7 Stocks with Recent Price Strength for Your Portfolio
In the stock game, winning means reaching a higher price.
However, finding a win-win strategy is easier said than done. In the current highly volatile market, it is difficult for even an ardent investor to come up with a foolproof approach.
One could resort to commonly used techniques to find beaten down stocks that have the potential to recover faster than others. But this bears the risk of disappointment. Particularly, one could get stuck in the value trap if the hidden weaknesses in selected stocks are not identified.
So, wouldn’t it be safer to look for stocks that are winners currently and have the potential to gain further?
If you are convinced of this strategy, here’s how to execute it:
One should primarily look for stocks that have recently been witnessing a price increase. Actually, stocks backed by recent price strength have a high chance of carrying the momentum forward.
If a stock is continuously moving higher, there must be a good reason for the rise or else it probably would have fallen or remained stable. So, looking at stocks that have already won the game and are capable of beating the benchmark that they have set themselves sounds rational.
However, recent price strength alone cannot create magic. So you need to set other relevant parameters for a successful investment strategy.
Here’s how you should create the screen to shortlist current as well as potential winners.
Screening Parameters:
Percentage Change in Price (4 Weeks) greater than zero: This criterion shows that the stock moved higher in the last four weeks.
Percentage Change Price (12 Weeks) greater than 10: This indicates that the stock saw momentum over the last three months. This lowers the risk of choosing stocks that may have drawn attention due to the overwhelming performance of the overall market in a very short span.
Zacks Rank 1: No matter whether the market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) have a proven history of outperformance.
Average Broker Rating 1: This indicates that brokers are also highly hopeful about the stock’s future performance.
Current Price greater than 5: The stocks must all be trading at a minimum of $5 or higher.
Current Price/52-Week High-Low Range more than 85%: This criterion filters stocks that are trading near their respective 52-week highs. This indicates that these are strong enough in terms of price.
Here are seven of the 13 stocks that made it through this screen:
Innospec Inc. (IOSP - Free Report) , formerly known as Octel Corp., is a major manufacturer and distributor of fuel additives and other specialty chemicals. Their products are sold globally, primarily to oil refineries. The company surpassed the Zacks Consensus Estimate in each of the preceding four quarters, with an average positive surprise of 15.2%.
HomeStreet, Inc. (HMST - Free Report) is a diversified financial services company. It is engaged in real estate lending, including mortgage banking activities and retail and business banking operations, and serves consumers and businesses in the Pacific Northwest and Hawaii. The company beat the Zacks Consensus Estimate thrice in the preceding four quarters, with an average positive surprise of 17.3%.
Gibraltar Industries, Inc. (ROCK - Free Report) is a leading manufacturer, processor and distributor of metals and other engineered materials for the building products, vehicular, and other industrial markets. The company surpassed the Zacks Consensus Estimate in each of the preceding four quarters, with an average positive surprise of 74.5%.
PCM Inc. is a technology solutions provider to businesses, government and educational institutions and individual consumers. It offers technology products and solutions as well as consumer electronics equipment and other consumer products. The company surpassed the Zacks Consensus Estimate in the last two quarters, with an average positive surprise of 43.5%.
Horizon Global Corporation is a designer, manufacturer and distributor of towing, trailering, cargo management and accessory products for original equipment, aftermarket and retail customers. The company surpassed the Zacks Consensus Estimate in the last two quarters, with an average positive surprise of 75.8%.
Ducommun Incorporated (DCO - Free Report) manufactures components and assemblies principally for domestic and foreign commercial and military aircraft and space programs. Ducommun is a subcontractor to Lockheed Martin on the Space Shuttle external tank and a supplier of components for Space Shuttle and the International Space Station. Last quarter, the company posted a positive earnings surprise of 21.4%.
KT Corporation (KT - Free Report) provides telecommunication services. Its services include mobile telecommunications services, telephone services, fixed-line and VoIP telephone services. The company also provides interconnection services to other telecommunications’ companies, broadband Internet access services and other Internet-related services. It also offers information technology and network services, including consulting, designing, building, and maintaining of systems and communication networks.
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 backtesting 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 Research Wizard trial 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.
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.
Zacks Restaurant Recommendations: In addition to dining at these special places, you can feast on their stock shares. A Zacks Special Report spotlights 5 recent IPOs to watch plus 2 stocks that offer immediate promise in a booming sector. Download it free »