The year 2021 has been a topsy turvy ride for Wall Street. Major indices – Dow Jones Industrial, tech-laden Nasdaq and S&P 500 -- benefited from a resurgent economy, thanks to unprecedented stimulus, rapid vaccination drive and improving job market.
Several industries have been witnessing job additions, including transportation and warehousing, healthcare, professional and business services, manufacturing and construction. However, raging inflation, rising concerns over the spread of Omicron, further coronavirus-induced lockdowns and new travel restrictions as well as lack of federal support in the near term spooked the stock market in the latter part of this year. The Fed’s decision to systematically eliminate the monetary stimulus has been detrimental for Wall Street. The central bank is now expected to raise interest rates three times in 2022 to combat inflation. Nevertheless, the infrastructure development bill and the proposed CHIPS Act can provide a pair of legs to the stock market’s momentum this winter. Continued strong demand for chips is expected to benefit semiconductor companies. Tech stocks are expected to continue their momentum, primarily benefiting from changing consumer preferences and behavior. The stay-at-home trend has driven demand for web-based services like e-commerce, contactless payment and delivery. Top Momentum Picks
Momentum investing calls for a continued appraisal of stocks, which ensures that an investor does not pick a beaten-down name or overlook a thriving one. Momentum investors buy high on the anticipation that the stock will only ascend in the short-to-intermediate term.
Here we pick five momentum stocks that rose in the past week and month and have soared more than 40% on a year-to-date basis. Apart from robust earnings estimate revisions, each of these stocks has a favorable combination of a Momentum Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. Year-to-Date Performance
Image Source: Zacks Investment Research
Photronics ( PLAB Quick Quote PLAB - Free Report) is riding on robust performances from Integrated Circuit (IC) as well as Flat Panel Display (FPD) segments. Both IC and FPD segments are benefiting from strong demand across mainstream and high-end products. Photronics sports a Zacks Rank #1 and a Momentum Score of A. The Zacks Consensus Estimate for this $1.07-billion company’s fiscal 2022 earnings stands at $1.30 per share, up 26.2% in the past 60 days. Photronics’ shares have been up 6.91% in the past week and 26.83% in the past month. Preferred Apartment Communities’ ( APTS Quick Quote APTS - Free Report) growing footprint in the multifamily and shopping centers bodes well for its prospects. Preferred Apartment currently carries a Zacks Rank of 2 and a Momentum Score of A. The Zacks Consensus Estimate for its 2021 earnings is pegged at $1.08 per share, having been raised 10.2% in the past 60 days. Preferred Apartment has gained 17.84% in the past week and 16.68% in the past month. Accenture ( ACN Quick Quote ACN - Free Report) is riding on strong traction in its outsourcing and consulting businesses. The company has been strategically enhancing its cloud and digital marketing suite through buyouts and partnerships. Accenture’s strong operating cash flow has helped it reward its shareholders in the form of dividend payments and share repurchases, and pursue opportunities in areas that show true potential. Accenture currently carries a Zacks Rank of 2 and a Momentum Score of A. The Zacks Consensus Estimate for its fiscal 2022 earnings is pegged at $10.54 per share, up 4.2%, over the past 60 days. The stock has gained 6.26% in the past week and 8.92% in the past month. Broadcom ( AVGO Quick Quote AVGO - Free Report) is riding on continued strength across Semiconductor solutions and Infrastructure software verticals. Semiconductor revenues benefited from higher demand for wireless solutions and continued networking and broadband solutions momentum. Synergies from acquisitions of CA and Symantec’s enterprise security business are driving prospects for this Zacks Rank #2 stock. Broadcom carries a Momentum Score of A. The consensus mark for its fiscal 2022 earnings is pegged at $33.03 per share, up 6.5% in the past 60 days. The stock has gained 5.1% in the past week and 16.41% in the past month. Jabil ( JBL Quick Quote JBL - Free Report) shares have gained 5.91% in the past week and 8.34% in the past month. Jabil is benefiting from continued end-market strength and solid operational execution. The company is well-poised to witness strong top-line growth in mobility, industrial and semi cap, automotive and healthcare. Jabil currently carries a Zacks Rank #2 and a Momentum Score of A. The Zacks Consensus Estimate for its fiscal 2022 earnings is pegged at $6.47 per share, up 2.2% in the past 60 days.