For Immediate Release
Chicago, IL – May 2, 2023 – Stocks in this week’s article are Boyd Gaming Corp. (
BYD Quick Quote BYD - Free Report) , PACCAR Inc. ( PCAR Quick Quote PCAR - Free Report) , Meta Platforms, Inc. ( META Quick Quote META - Free Report) , PulteGroup, Inc. ( PHM Quick Quote PHM - Free Report) and Life Time Group Holdings, Inc. ( LTH Quick Quote LTH - Free Report) . 5 Excellent Stocks to Ride on Relative Price Strength
Closing out last week, the Fed’s favored inflation report — Personal Consumption Expenditures (PCE) — came in line with estimates. Among other economic positives, the regional bank failures of last month are likely in the rear-view mirror, while the labor market continues to be resilient.
At the same time, we should avoid painting an overly optimistic picture by overstating the improvements. While we are well off the peaks we saw in 2022, we have apparently hit a bed of resistance. In other words, inflation is indeed coming down, but too slowly. It means a near-certainty that another quarter-point rate hike is in the cards.
We believe that more visibility regarding the future market direction will only be available post first-quarter 2023 earnings season, along with management guidance and business outlook.
Till then, investors who want to stay exposed to the equity setup should focus on good investment opportunities. One of the ways such potential plays could be identified is to look for signs of relative price strength.
Relative Price Strength Strategy
Investors generally gauge a stock’s potential returns by examining earnings growth and valuation multiples. At the same time, it’s essential to measure the performance of such a stock relative to its industry or peers, or an appropriate benchmark.
If you see that a stock is underperforming on fundamental factors, it would be prudent to move on and find a better alternative. However, those outperforming their respective sectors in terms of price should be selected because they stand a better chance of providing considerable returns. Then again, it is imperative that you determine whether or not an investment has relevant upside potential when considering stocks with significant relative price strength. Stocks delivering better than the S&P 500 for 1 to 3 months at least and having solid fundamentals indicate room for growth and are the best ways to go about this strategy.
Finally, it is crucial to find out whether analysts are optimistic about the upcoming earnings of these companies. In order to do this, we have added positive estimate revisions for the current quarter’s (Q1) earnings to our screen. When a stock undergoes an upward revision, it leads to additional price gains.
Here are five of the 10 stocks that made it through the screen:
Boyd Gaming Corp.: This is a multi-jurisdictional gaming company, which owns and operates gaming entertainment properties in several states. The 2023 Zacks Consensus Estimate for Las Vegas-based BYD indicates 2.8% year-over-year earnings per share growth. Boyd Gaming has a VGM Score of B.
Over the past 60 days, Boyd Gaming saw the Zacks Consensus Estimate for 2023 move up 6.8%. It beat the Zacks Consensus Estimate for earnings in each of the last two quarters. BOYD shares have moved up 13.8% in a year.
PACCAR Inc.: The company is a leading manufacturer of heavy-duty trucks in the world and has substantial manufacturing exposure to light/medium trucks. Over the past 60 days, this Bellevue, WA-based firm saw the Zacks Consensus Estimate for 2023 move up 15.6%. PCAR has a VGM Score of A.
PACCAR beat the Zacks Consensus Estimate for earnings in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 16.6%, on average. PCAR shares have increased 33.3% in a year.
Meta Platforms, Inc.: It is the world’s largest social media platform. The 2023 Zacks Consensus Estimate for this Menlo Park, CA-based META indicates 15.4% year-over-year earnings per share growth. Meta Platforms has a VGM Score of B.
Over the past 60 days, META saw the Zacks Consensus Estimate for 2023 move up 16.9%. It beat the Zacks Consensus Estimate for earnings in two of the last four quarters. Meta Platforms shares have gained 13.8% in a year.
PulteGroup, Inc.: The company engages in homebuilding and financial services businesses, primarily in the United States. Over the past 60 days, this Atlanta, GA-based firm saw the Zacks Consensus Estimate for 2023 move up 13.3%. PHM has a VGM Score of A.
PulteGroup beat the Zacks Consensus Estimate for earnings in three of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 15.6%, on average. PHM shares have increased 58.2% in a year.
Life Time Group Holdings, Inc.: It is the operator of premium health clubs throughout the United States and Canada. The 2023 Zacks Consensus Estimate for this Chanhassen, MN-based LTH indicates 311.1% year-over-year earnings per share growth. Life Time Group Holdings has a VGM Score of B.
Over the past 60 days, LTH saw the Zacks Consensus Estimate for 2023 move up 58.3%. It beat the Zacks Consensus Estimate for earnings in each of the last four quarters. Life Time Group Holdings shares have gained 42% in a year.
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 For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2087415/5-excellent-stocks-to-ride-on-relative-price-strength 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. About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
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Contact: Jim Giaquinto
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