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Take the Zacks Approach to Beat the Market: Shopify, Oracle, Uber in Focus
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The three most widely followed indexes closed last week in the red. The Dow Jones Industrial Average declined 1.7%, while both the S&P 500 and the Nasdaq Composite lost 1.4% each. For the tech-heavy Nasdaq, this weekly loss comes after eight straight weeks of gains, while the S&P 500 snapped a five-week winning streak.
Fed Chair Jerome Powell’s Congressional testimony dominated trade throughout the week. In their comments throughout the week, Powell and other important fed officials made it clear that the central bank was looking at two other 25 bps interest rate hikes till the year-end.
Inflation is on a downward slope but still far from the Fed’s target level of 2%. The decision-makers seem committed to raising rates further. This wasn’t good news from the market as recession fears got stoked yet again.
Fed officials have also suggested that the decision on interest rates will have to be taken keeping in mind the regional banking crisis seen in March and April. This grim outlook for the rest of the year provided by the Fed has dampened investor mood, and currently, there is a majoritarian view that rate hike may be resumed as early as July.
Regardless of market conditions, we, here at Zacks, provide investors with unbiased guidance on how to beat the market.
As usual, Zacks Research guided investors over the past three months with its time-tested methodologies. 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:
Aeglea and Omeros Surge Following Zacks Rank Upgrade
Shares of Aeglea BioTherapeutics, Inc. have soared 110.5% (versus the S&P 500’s 6.8% increase) since it was upgraded to a Zacks Rank #2 (Buy) on April 13.
Another stock, Omeros Corporation (OMER - Free Report) , which was also upgraded to a Zacks Rank #2 on April 10, has returned 14.6% (versus the S&P 500’s 6.3% increase) since then.
Zacks Rank, our short-term rating system, has earnings estimate revisions at its core. Empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
This 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 stocks here >>>
A hypothetical portfolio of Zacks Rank #1 (Strong Buy) stocks returned +2.7% this year (through May 15) versus +7.69% for the S&P 500 Index.
Zacks Recommendation Upgrade Drives ServiceNow and Ingersoll Rand Higher
Shares of ServiceNow, Inc. (NOW - Free Report) and Ingersoll Rand Inc. (IR - Free Report) have advanced 15.4% (versus the S&P 500’s 5.3% rise) and 13%, respectively, since their Zacks Recommendation was upgraded to Outperform on April 18.
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 Stocks Uber, Adobe Shoot Up
Shares of Uber Technologies, Inc. (UBER - Free Report) , which belongs to the Zacks Focus List, have risen 36.7% over the past 12 weeks. The stock was added to the Focus List on August 16, 2019. Another Focus-List holding, Adobe Inc. (ADBE - Free Report) , which was added to the portfolio on March 13, 2020, has returned 25.8% over the past 12 weeks. The S&P 500 has gained 6.4% over this period.
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.
The 50-stock Zacks Focus List model portfolio returned +9.14% in 2023 (through May 31) versus +9.64% for the S&P 500 Index. In 2022, the portfolio produced -15.2% versus the S&P 500 Index’s -17.96%.
Since 2004, the Focus List portfolio has produced an annualized return of +10.75% through May 31, 2023. This compares to a +9.2% annualized return for the S&P 500 Index in the same time period.
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 Stocks Oracle and Rollins Make Significant Gains
Oracle Corporation (ORCL - Free Report) , a component of our Earnings Certain Admiral Portfolio (ECAP), has jumped 27.7% over the past 12 weeks. Rollins, Inc. (ROL - Free Report) has followed Oracle with 10.3% returns.
ECAP, which consists of 30 concentrated, ultra-defensive, long-term Buy and Hold stocks, returned +3.05% in 2023 (through May 31) versus +9.64% for the S&P 500 Index. The portfolio returned -4.7% in 2022 versus the S&P 500 Index’s -17.96%.
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.
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 Stocks Medtronic and Johnson & Johnson Outperform Peers
Medtronic plc (MDT - Free Report) , which is part of our Earnings Certain Dividend Portfolio (ECDP), has returned 8.5% over the past 12 weeks. Another ECDP stock, Johnson & Johnson (JNJ - Free Report) , has climbed 6.8% over the same time frame. Of course, the inclination of investors toward quality dividend stocks to secure an income stream amid heightened market volatility contributed to this performance.
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.
ECDP returned -3.2% in 2023 (through May 31) versus +9.64% for the S&P 500 Index and +1.39% for the ProShares S&P 500 Dividend Aristocrats ETF (NOBL - Free Report) . The portfolio returned -2.3% in 2022 versus -17.96% for the S&P 500 Index and -8.34% for NOBL.
Zacks Top 10 Stocks — Shopify Delivers Solid Returns
Shopify Inc. (SHOP - Free Report) , from the Zacks Top 10 Stocks for 2023, has gained 83.8% year to date, which compares to a 14.1% gain for the S&P 500 Index.
The portfolio returned +7.12% through the end of May 2023 versus +9.64% for the S&P 500 (the equal-weighted index, a more appropriate benchmark returned -0.63% in the same time period). The portfolio returned -15.8% in 2022 versus -18.1% for the S&P 500 Index. Since 2012, the Top 10 portfolio has generated an annualized return of +22.4% versus +12.5% for the S&P 500 Index.
Since the start of 2012, the Zacks Top 10 Stocks delivered a cumulative return of 827.6% through the end of 2022 versus a 265% cumulative return for the S&P 500 Index.
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Take the Zacks Approach to Beat the Market: Shopify, Oracle, Uber in Focus
The three most widely followed indexes closed last week in the red. The Dow Jones Industrial Average declined 1.7%, while both the S&P 500 and the Nasdaq Composite lost 1.4% each. For the tech-heavy Nasdaq, this weekly loss comes after eight straight weeks of gains, while the S&P 500 snapped a five-week winning streak.
Fed Chair Jerome Powell’s Congressional testimony dominated trade throughout the week. In their comments throughout the week, Powell and other important fed officials made it clear that the central bank was looking at two other 25 bps interest rate hikes till the year-end.
Inflation is on a downward slope but still far from the Fed’s target level of 2%. The decision-makers seem committed to raising rates further. This wasn’t good news from the market as recession fears got stoked yet again.
Fed officials have also suggested that the decision on interest rates will have to be taken keeping in mind the regional banking crisis seen in March and April. This grim outlook for the rest of the year provided by the Fed has dampened investor mood, and currently, there is a majoritarian view that rate hike may be resumed as early as July.
Regardless of market conditions, we, here at Zacks, provide investors with unbiased guidance on how to beat the market.
As usual, Zacks Research guided investors over the past three months with its time-tested methodologies. 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:
Aeglea and Omeros Surge Following Zacks Rank Upgrade
Shares of Aeglea BioTherapeutics, Inc. have soared 110.5% (versus the S&P 500’s 6.8% increase) since it was upgraded to a Zacks Rank #2 (Buy) on April 13.
Another stock, Omeros Corporation (OMER - Free Report) , which was also upgraded to a Zacks Rank #2 on April 10, has returned 14.6% (versus the S&P 500’s 6.3% increase) since then.
Zacks Rank, our short-term rating system, has earnings estimate revisions at its core. Empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
This 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 stocks here >>>
A hypothetical portfolio of Zacks Rank #1 (Strong Buy) stocks returned +2.7% this year (through May 15) versus +7.69% for the S&P 500 Index.
Check Aglea’s historical EPS and Sales here>>>
Check Omeros’ historical EPS and Sales here>>>
Image Source: Zacks Investment Research
Zacks Recommendation Upgrade Drives ServiceNow and Ingersoll Rand Higher
Shares of ServiceNow, Inc. (NOW - Free Report) and Ingersoll Rand Inc. (IR - Free Report) have advanced 15.4% (versus the S&P 500’s 5.3% rise) and 13%, respectively, since their Zacks Recommendation was upgraded to Outperform on April 18.
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 Stocks Uber, Adobe Shoot Up
Shares of Uber Technologies, Inc. (UBER - Free Report) , which belongs to the Zacks Focus List, have risen 36.7% over the past 12 weeks. The stock was added to the Focus List on August 16, 2019. Another Focus-List holding, Adobe Inc. (ADBE - Free Report) , which was added to the portfolio on March 13, 2020, has returned 25.8% over the past 12 weeks. The S&P 500 has gained 6.4% over this period.
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.
The 50-stock Zacks Focus List model portfolio returned +9.14% in 2023 (through May 31) versus +9.64% for the S&P 500 Index. In 2022, the portfolio produced -15.2% versus the S&P 500 Index’s -17.96%.
Since 2004, the Focus List portfolio has produced an annualized return of +10.75% through May 31, 2023. This compares to a +9.2% annualized return for the S&P 500 Index in the same time period.
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 Stocks Oracle and Rollins Make Significant Gains
Oracle Corporation (ORCL - Free Report) , a component of our Earnings Certain Admiral Portfolio (ECAP), has jumped 27.7% over the past 12 weeks. Rollins, Inc. (ROL - Free Report) has followed Oracle with 10.3% returns.
ECAP, which consists of 30 concentrated, ultra-defensive, long-term Buy and Hold stocks, returned +3.05% in 2023 (through May 31) versus +9.64% for the S&P 500 Index. The portfolio returned -4.7% in 2022 versus the S&P 500 Index’s -17.96%.
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.
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 Stocks Medtronic and Johnson & Johnson Outperform Peers
Medtronic plc (MDT - Free Report) , which is part of our Earnings Certain Dividend Portfolio (ECDP), has returned 8.5% over the past 12 weeks. Another ECDP stock, Johnson & Johnson (JNJ - Free Report) , has climbed 6.8% over the same time frame. Of course, the inclination of investors toward quality dividend stocks to secure an income stream amid heightened market volatility contributed to this performance.
Check Medtronic’s dividend history here>>>
Check Johnson & Johnson’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.
ECDP returned -3.2% in 2023 (through May 31) versus +9.64% for the S&P 500 Index and +1.39% for the ProShares S&P 500 Dividend Aristocrats ETF (NOBL - Free Report) . The portfolio returned -2.3% in 2022 versus -17.96% for the S&P 500 Index and -8.34% for NOBL.
Click here to access this portfolio on Zacks Advisor Tools.
Zacks Top 10 Stocks — Shopify Delivers Solid Returns
Shopify Inc. (SHOP - Free Report) , from the Zacks Top 10 Stocks for 2023, has gained 83.8% year to date, which compares to a 14.1% gain for the S&P 500 Index.
The portfolio returned +7.12% through the end of May 2023 versus +9.64% for the S&P 500 (the equal-weighted index, a more appropriate benchmark returned -0.63% in the same time period). The portfolio returned -15.8% in 2022 versus -18.1% for the S&P 500 Index. Since 2012, the Top 10 portfolio has generated an annualized return of +22.4% versus +12.5% for the S&P 500 Index.
Since the start of 2012, the Zacks Top 10 Stocks delivered a cumulative return of 827.6% through the end of 2022 versus a 265% cumulative return for the S&P 500 Index.