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5 Value Stock Breakout Stars of 2020

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  • (1:00) - How Should Investors Prepare For 2021?
  • (9:50) - Stock Screener and Tracey’s Top Stock Picks
  • (29:20) - Episode Roundup: SGC, ONEW, HZO, R, AMKR, DELL, TM

Welcome to Episode #218 of the Value Investor Podcast.

Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.

In 2020, it was again all about growth stocks, led by FAANG.

But value stocks got an undeserved bad rap because not all of value under performed.

With the small caps, including small cap value, rallying big in November and December, some value stocks had breakout years.

Screening for Value Stocks with Momentum

Zacks.com has great predefined stock screens, including several for value stocks.

One of them is value stocks near their 52-week highs which means that those stocks have momentum.

The screen includes stocks within 10% of their 52-week high with Zacks Value Style Scores of A, which is the highest score.

And then add on the powerful Zacks Ranks of #1 (Strong Buy) or #2 (Buy) to, hopefully, get rising earnings estimates.

This screen returned 44 value stocks with momentum in the final weeks of 2020.

5 Value Stock Breakout Stars of 2020

1.       OneWater Marine Inc. (ONEW - Free Report) went IPO in February 2020, just before the coronavirus shutdown, and stock market sell-off, hit. But that hasn’t stopped this large premium boat retailer from having a record year with sales up 33% in fiscal 2020. Shares have soared, up 101% year-to-date but they’re still cheap, with a forward P/E of just 8.1.

2.       MarineMax, Inc. (HZO - Free Report) is also a boat and yacht retailer. In fiscal 2020 it reported its highest earnings and revenue in the company’s history as consumers bought boats during the pandemic. Shares of this small-cap retailer have jumped 120.6% year-to-date but trade with a forward P/E of 9.6. Analysts see fiscal 2021 sales jumping another 21%.

3.       Ryder System, Inc. (R - Free Report) is a mid-cap transportation and logistics company with operations in the US, Mexico, Canada and the UK. Business has been hit hard by the pandemic but it started to see a recovery in the third quarter of 2020. Analysts expect earnings to bounce back big in 2021. Shares are up 18.2% year-to-date and have busted out to new 52-week highs.

4.       Amkor Technology (AMKR - Free Report) is one of the largest providers of outsourced semiconductor packaging and testing. It has partnered with many of the world’s largest semiconductor manufacturers. It had a big third quarter with stronger-than-expected demand in communications, auto, and industrial end markets. Shares are up 16.9% year-to-date and have busted out of a recent 5-year channel to new highs. They’re still cheap, with a forward P/E of just 12.1.

5.       Stewart Information Services Corp. (STC - Free Report) is a title insurance and real estate services company with a market cap of $1.3 billion. Earnings are expected to soar 98.5% in 2020 as the housing market remains hot. Shares are up 17.2% year-to-date and are at new 52-week highs. They’re still cheap, with a forward P/E of 9.1. But is the sizzling housing market about to cool off in 2021?

What else should you know about value stocks that are breaking out to end 2020?

Find out on this week’s podcast.

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