Back to top

Image: Bigstock

Beat the Market Like Zacks: Procter & Gamble (PG), Intuit (INTU), Fastenal (FAST) in Focus

Read MoreHide Full Article

Two of the three most widely followed indexes closed in the green last week, continuing the recovery, which started last month. The tech-heavy Nasdaq and the S&P 500 advanced 2.2% and 0.4%, respectively, while the Dow Jones Industrial Average fell 0.1% for the week.

Rising inflation, the continued geopolitical crisis and the resultant energy shortage, and COVID-19 flare-ups in China have clouded investor mood for the better part of this year. Fears of an impending recession have also played spoilsport, as has the Taiwan situation.

However, a largely upbeat second-quarter earnings season and some positive economic data have helped the S&P 500 bounce back. Investors continue to keep a keen watch on the inflation data slated to release this week and how it influences the monetary policy of the hawkish Fed, hoping there is no further tightening.

Regardless of market conditions, we, here at Zacks, provide investors with unbiased guidance on how to beat the market.  

Zacks Research guided investors last week with its time-tested methodologies as usual. Given the prevailing market uncertainty, you may want to look at our feats to prepare better for your next action.

Here are some of our key achievements from last week:

HeritageCrystal, Manhattan Associates Soar Following Zacks Rank Upgrade

Shares of HeritageCrystal Clean (HCCI - Free Report) have gained 5% since it was upgraded to a Zacks Rank #1 (Strong Buy) on July 30. The rating upgrade was primarily driven by an upward trend in earnings estimates, one of the most powerful forces impacting stock prices. A company's changing earnings picture is at the core of the Zacks rating.  

For HCCI, the consensus EPS estimate of $3.33 for the current year has increased 43.1% over the past month.

Rising earnings estimates and the consequent Zacks Rank upgrade for HCCI imply an improvement in the company's underlying business. Investors have started showing their appreciation for this improving business trend by pushing the stock higher.

Check HeritageCrystal’s historical EPS and Sales here>>>

Manhattan Associates, Inc. (MANH - Free Report) , another stock upgraded to a Zacks Rank #1 on July 30, has returned 3.1% over the past week. Over the past month, an 11.3% increase in the current-year consensus EPS estimate has driven the rating upgrade.  

The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +24.8% since 1988. You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here >>>

Check Manhattan Associates’ historical EPS and Sales here>>>

Zacks Investment Research
Image Source: Zacks Investment Research

Zacks Recommendation Upgrade Drives Clearfield, AXT Higher  

Shares of Clearfield, Inc. (CLFD - Free Report) and AXT, Inc. (AXTI - Free Report) have gained 31.4% and 24.9%, respectively, since their Zacks Recommendation was upgraded to Outperform on August 1.

While the Zacks Rank is our short-term rating system that is most effective over the one- to three-month holding horizon, the Zacks Recommendation aims to predict performance over the next 6 to 12 months. However, just like the Zacks Rank, the foundation for the Zacks Recommendation is trends in earnings estimate revisions.

The Zacks Recommendation classifies stocks into three groups — Outperform, Neutral and Underperform. While these recommendations are determined quantitatively, our analysts have the flexibility to override them for the 1100+ stocks they closely follow based on their better judgment of factors such as valuation, industry conditions and management effectiveness than the quantitative model.

To access our research reports with Zacks Recommendations for the 1100+ stocks we cover, click here>>>

Zacks Focus List Model Portfolio Stock Arcosa Surges   

Shares of Arcosa, Inc. (ACA - Free Report) , which belongs to the Zacks Focus List, have shot up 17.5% over the past week. The Zacks Focus List is a model portfolio of 50 hand-picked stocks that possess the right fundamental ingredients to outperform the market over the next 12 months. These 50 stocks are picked from a long list of stocks with the highest Zacks Rank.

Arcosa was added to the Focus List on January 6, 2020, at $45.70 per share. The stock has gained 32.3% since then to close the last trading session at $60.44.

Since its inception on February 1, 1996, the Focus List portfolio has delivered an annualized return of +12.9%.

Unlock all of our powerful research, tools and analysis, including the Focus List, Zacks #1 Rank List, Equity Research Reports, Zacks Earnings ESP Filter, Premium Screener and more, as part of Zacks Premium. Gain full access now >>

Zacks ECAP Stock Procter & Gamble Outperforms the Market

The Procter & Gamble Company (PG - Free Report) , a component of our Earnings Certain Admiral Portfolio (ECAP), surged 4.2% last week. ECAP is a model portfolio of 30 concentrated, ultra-defensive, long-term Buy and Hold stocks.  

With little to no turnover and annual rebalance periodicity, the ECAP seeks to minimize capital loss by holding shares of companies whose earnings streams exhibit a proven 20+ year track record of surviving recessionary periods with minimal impact on aggregate earnings growth relative to the overall S&P 500.

In terms of last week’s returns, Intercontinental Exchange, Inc. (ICE - Free Report) and  Intuit Inc. (INTU - Free Report) followed Procter & Gamble with 3% and 2.8% gains, respectively.

The ECAP and many other model portfolios are available as part of Zacks Advisor Tools, a cloud-based solution to access Zacks award-winning stock, mutual fund and ETF research. Click here to schedule a demo.

Zacks ECDP Stock Fastenal Witnesses Price Increase

Fastenal Company (FAST - Free Report) , a part of our Earnings Certain Dividend Portfolio (ECDP), jumped 3.1% last week. The inclination of investors toward quality dividend stocks to secure an income stream amid the heightened market volatility contributed to this performance. Check Fastenal’s dividend history here>>>

With an extremely low Beta and a history of minimum earnings variability over the last 20+ years, this 25-stock portfolio helps significantly mitigate risk. The ECDP has consistently outperformed the S&P 500 Dividend Aristocrats ETF (NOBL - Free Report) .

Click here to access this portfolio on Zacks Advisor Tools.