Back to top

Image: Bigstock

The Zacks Analyst Blog Highlights: Liquidity Services, Bassett Furniture, Hibbett Sports, Titan Machinery and Gogo

Read MoreHide Full Article

For Immediate Release

Chicago, IL – January 07, 2021 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Liquidity Services, Inc. (LQDT - Free Report) , Bassett Furniture Industries, Incorporated (BSET - Free Report) , Hibbett Sports, Inc. (HIBB - Free Report) , Titan Machinery Inc. (TITN - Free Report) and Gogo Inc. (GOGO - Free Report) .

Here are highlights from Wednesday’s Analyst Blog:

5 Small-Cap Stocks to Make the Most of the "January Effect"

January is usually a pretty strong month for stocks, suggesting that many could see large gains in the first month of the year if historical trends hold true. This is largely attributed to the "January Effect."

What Is January Effect?

January Effect is a seasonal increase in stock prices due largely to year-end tax considerations. Investors redeploy their capital to speculate on weaker performers in January after selling winners in December to create tax losses. This phenomenon pushes the stock market higher in the first month of the year.

While large caps tend to perform better, small-cap securities have historically proven their outperformance in January. According to some market experts, the January Effect actually runs from mid December through February, with the small caps continuing to outperform their large-cap cousins.

January Effect Looks Real This Year

Though worries over the prolonged coronavirus crisis and runoff elections for two Senate seats in Georgia led to a worst start to 2021 in five years, the combination of factors including vaccine rollout and super easy policies will continue to charge the bulls.
    
The wider reach of the coronavirus vaccine is expected to the end of the pandemic resulting in higher demand for all types of products and services in the economy. As small-cap companies are closely tied to the U.S. economy, these are poised to outperform when the economy improves. These pint-sized stocks generate most of their revenues from the domestic market, making them great choices during an uptrend (read: Small-Cap ETFs Face Off: IWM Vs. IJR).

Additionally, the super-easy monetary policy has been driving the small-cap rally. Fed pledged to hold rates near zero and will continue the asset purchase program at the current rate until "substantial further progress" has been made toward reaching maximum employment and healthy inflation. A low interest rate bodes well for small-cap stocks as it pushes up economic activities and results in higher spending, thus boosting domestically focused companies.

The combination of factors will provide support to the January Effect, leading to a rally in the small-cap space.

For investors seeking to capitalize on this opportunity, the following small-cap stocks could be solid pure plays. All these have a solid Zacks Rank #1 (Strong Buy) or 2 (Buy).

Liquidity Services
 
This company employs innovative e-commerce marketplace solutions to manage, value and sell inventory and equipment for business and government clients.

Zacks Rank: #2
Growth Score: A
Market Cap: $555.3 million
Industry Rank: Top 7%

Bassett Furniture Industries Inc.

It is a leading manufacturer and marketer of high quality, mid-priced home furnishings.

Zacks Rank: #1
Growth Score: A
Market Cap: $191.1 million
Industry Rank: Top 6%

You can see the complete list of today's Zacks #1 Rank stocks here.

Hibbett Sports

It is a major athletic-inspired retailer, located in small and mid-sized markets across the country.

Zacks Rank: #1
Growth Score: A
Market Cap: $761 million
Industry Rank: Top 6%

Titan Machinery

This company owns and operates a network of full-service agricultural and construction equipment stores (read: 6 Predictions for the ETF World in 2021).

Zacks Rank: #1
Growth Score: A
Market Cap: $427.2 million
Industry Rank: Top 14%

Gogo

It is the leading provider of in-flight connectivity and wireless entertainment solutions for the global aviation industry.

Zacks Rank: #2
Growth Score: A
Market Cap: $815.8 million
Industry Rank: Top 14%

Bottom Line

January is truly the time to get in on small-cap securities with the above-mentioned ETFs and stocks, assuming that the historical trend holds true in 2021. A vaccine and massive money flows have also boosted the appeal of these pint-sized products.

Want key ETF info delivered straight to your inbox?

Zacks' free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>

Media Contact

Zacks Investment Research

800-767-3771 ext. 9339

support@zacks.com                                      

https://www.zacks.com                                          

 

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.