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5 Stocks With Recent Price Strength Under Severe Volatility
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After a five month-long astonishing rally, Wall Street suffered back-to-back monthly declines. All the three major stock indexes — the Dow, the S&P 500 and the Nasdaq Compsite — tumbled 2.3%, 3.9% and 5.2%, respectively, in September and 4.6%, 2.8% and 2.3%, in October. This happened for the first time after March.
Fundamentals of the U.S. economy are stable in spite of the eight month-long coronavirus-induced devastations. In fact, the devastation is not as severe as was expected in March. Despite this, the downward trend in Wall Street may be due to the fact that economic data are historical facts while stock prices depend on market participants expectations about the future.
The resurgence of coronavirus in the United States and the second round of partial lockdowns imposed in a few major Eurozone economies significantly dented investors' sentiment regarding global economic recovery.
Moreover, a tighter-than-expected upcoming U.S. presidential election and the inability of the U.S. Congress to reach a deal on the size and the scope of a fresh fiscal stimulus dampened investors' sentiments. The outcome of the election in the White House as well as the House of Representatives and Senate will determine the possibility of a new dose of coronavirus-aid package.
At this stage, wouldn’t it be a safer strategy to look for stocks that are winners and have the potential to gain further?
Sounds Good? Here’s How to Execute It:
One should primarily target stocks that have freshly been on a bull run. Actually, stocks seeing price strength recently have a high chance of carrying the momentum forward.
If a stock is continuously witnessing an uptrend, there must be a solid reason or else it would have probably crashed. So, looking at stocks that are capable of beating the benchmark that they have set for themselves seems rational.
However, recent price strength alone cannot create magic. Therefore, you need to set other relevant parameters to create a successful investment strategy.
Here’s how you should create the screen to shortlist the current as well as the potential winners.
Screening Parameters:
Percentage Change in Price (4 Weeks) greater than zero: This criterion shows that the stock has moved higher in the last four weeks.
Percentage Change Price (12 Weeks) greater than 10: This indicates that the stock has seen 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 period.
Zacks Rank 1: No matter whether market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) have a proven history of outperformance. You can see the complete list of today’s Zacks #1 Rank stocks here.
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.
Current Price/ 52-Week High-Low Range more than 85%: This criterion filters stocks that are trading near their respective 52-week highs. It indicates that these are strong enough in terms of price.
Just these few criteria have narrowed down the search from over 7,700 stocks to just seven.
Here we present five out of those seven stocks:
Matson Inc. (MATX - Free Report) provides ocean transportation and logistics services. Its Ocean Transportation segment offers ocean freight transportation services to the domestic non-contiguous economies of Hawaii, Alaska, and Guam, as well as to other island economies in Micronesia.
The stock price has soared 31.3% in the past four weeks. The company has expected earnings growth of 40.8% for the current year. The Zacks Consensus Estimate for the current year has improved 24% over the last 30 days.
Surface Oncology Inc. is a clinical-stage immuno-oncology company. It develops therapies for the treatment of cancer. The stock price has jumped 23.5% in the past four weeks. The company has expected earnings growth of 63.5% for the current year. The Zacks Consensus Estimate for the current year has improved 5.3% over the last 60 days.
Green Brick Partners Inc. (GRBK - Free Report) operates as a homebuilding and land development company in the United States. It operates in three segments: Builder operations Central, Builder operations Southeast, and Land development..
The stock price has appreciated 14.8% in the past four weeks. The company has expected earnings growth of 75.9% for the current year. The Zacks Consensus Estimate for the current year has improved by 5.7% over the last 30 days.
Merchants Bancorp (MBIN - Free Report) operates as a diversified bank holding company in the United States. It operates through the Multi-family Mortgage Banking, Mortgage Warehousing, and Banking segments.
The stock price has appreciated 8.8% in the past four weeks. The company has expected earnings growth of more than 100% for the current year. The Zacks Consensus Estimate for the current year has improved 24.8% over the last 7 days.
Herc Holdings Inc. (HRI - Free Report) operates as an equipment rental supplier primarily in the United States. It rents aerial, earthmoving, material handling, trucks and trailers, air compressors, compaction, and lighting equipment.
The stock price has gained 8.7% in the past four weeks. Although the company has negative expected earnings growth for the current year, its growth rate is 12.1% for next year. The Zacks Consensus Estimate for the current year has improved 45% over the last 30 days.
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
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.
Image: Bigstock
5 Stocks With Recent Price Strength Under Severe Volatility
After a five month-long astonishing rally, Wall Street suffered back-to-back monthly declines. All the three major stock indexes — the Dow, the S&P 500 and the Nasdaq Compsite — tumbled 2.3%, 3.9% and 5.2%, respectively, in September and 4.6%, 2.8% and 2.3%, in October. This happened for the first time after March.
Fundamentals of the U.S. economy are stable in spite of the eight month-long coronavirus-induced devastations. In fact, the devastation is not as severe as was expected in March. Despite this, the downward trend in Wall Street may be due to the fact that economic data are historical facts while stock prices depend on market participants expectations about the future.
The resurgence of coronavirus in the United States and the second round of partial lockdowns imposed in a few major Eurozone economies significantly dented investors' sentiment regarding global economic recovery.
Moreover, a tighter-than-expected upcoming U.S. presidential election and the inability of the U.S. Congress to reach a deal on the size and the scope of a fresh fiscal stimulus dampened investors' sentiments. The outcome of the election in the White House as well as the House of Representatives and Senate will determine the possibility of a new dose of coronavirus-aid package.
At this stage, wouldn’t it be a safer strategy to look for stocks that are winners and have the potential to gain further?
Sounds Good? Here’s How to Execute It:
One should primarily target stocks that have freshly been on a bull run. Actually, stocks seeing price strength recently have a high chance of carrying the momentum forward.
If a stock is continuously witnessing an uptrend, there must be a solid reason or else it would have probably crashed. So, looking at stocks that are capable of beating the benchmark that they have set for themselves seems rational.
However, recent price strength alone cannot create magic. Therefore, you need to set other relevant parameters to create a successful investment strategy.
Here’s how you should create the screen to shortlist the current as well as the potential winners.
Screening Parameters:
Percentage Change in Price (4 Weeks) greater than zero: This criterion shows that the stock has moved higher in the last four weeks.
Percentage Change Price (12 Weeks) greater than 10: This indicates that the stock has seen 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 period.
Zacks Rank 1: No matter whether market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) have a proven history of outperformance. You can see the complete list of today’s Zacks #1 Rank stocks here.
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.
Current Price/ 52-Week High-Low Range more than 85%: This criterion filters stocks that are trading near their respective 52-week highs. It indicates that these are strong enough in terms of price.
Just these few criteria have narrowed down the search from over 7,700 stocks to just seven.
Here we present five out of those seven stocks:
Matson Inc. (MATX - Free Report) provides ocean transportation and logistics services. Its Ocean Transportation segment offers ocean freight transportation services to the domestic non-contiguous economies of Hawaii, Alaska, and Guam, as well as to other island economies in Micronesia.
The stock price has soared 31.3% in the past four weeks. The company has expected earnings growth of 40.8% for the current year. The Zacks Consensus Estimate for the current year has improved 24% over the last 30 days.
Surface Oncology Inc. is a clinical-stage immuno-oncology company. It develops therapies for the treatment of cancer. The stock price has jumped 23.5% in the past four weeks. The company has expected earnings growth of 63.5% for the current year. The Zacks Consensus Estimate for the current year has improved 5.3% over the last 60 days.
Green Brick Partners Inc. (GRBK - Free Report) operates as a homebuilding and land development company in the United States. It operates in three segments: Builder operations Central, Builder operations Southeast, and Land development..
The stock price has appreciated 14.8% in the past four weeks. The company has expected earnings growth of 75.9% for the current year. The Zacks Consensus Estimate for the current year has improved by 5.7% over the last 30 days.
Merchants Bancorp (MBIN - Free Report) operates as a diversified bank holding company in the United States. It operates through the Multi-family Mortgage Banking, Mortgage Warehousing, and Banking segments.
The stock price has appreciated 8.8% in the past four weeks. The company has expected earnings growth of more than 100% for the current year. The Zacks Consensus Estimate for the current year has improved 24.8% over the last 7 days.
Herc Holdings Inc. (HRI - Free Report) operates as an equipment rental supplier primarily in the United States. It rents aerial, earthmoving, material handling, trucks and trailers, air compressors, compaction, and lighting equipment.
The stock price has gained 8.7% in the past four weeks. Although the company has negative expected earnings growth for the current year, its growth rate is 12.1% for next year. The Zacks Consensus Estimate for the current year has improved 45% over the last 30 days.
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
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.