For Immediate Release
Chicago, IL – July 18, 2023 – Stocks in this week’s article are RLI (
RLI Quick Quote RLI - Free Report) , MamaMancini's Holdings and Evolution Petroleum ( EPM Quick Quote EPM - Free Report) . 3 Momentum Stocks Worth a Buy Backed by Driehaus Strategy
The best momentum stocks can be chosen by applying the Driehaus strategy. It is known as the “buy high and sell higher” theory. No doubt, it’s a successful investment strategy that helped Richard Driehaus make a place in Barron’s All-Century Team.
To that end, stocks like
RLI, MamaMancini's Holdings and Evolution Petroleum have been selected as the momentum picks for the day using the Driehaus strategy. A Detailed Look Into the Driehaus Strategy
Regarding the strategy, Driehaus once said: “I would much rather invest in a stock that’s increasing in price and take the risk that it may begin to decline than invest in a stock that’s already in decline and try to guess when it will turn around.” In line with this insight, the American Association of Individual Investors (AAII) considered the percentage 50-day moving average as one of the key criteria before creating a portfolio following Driehaus’ philosophy.
It is calculated by dividing the numerator (month-end price minus 50-day moving average of month-end price) by the 50-day moving average of the month-end price. Another momentum indicator — positive relative strength — has also been included in this strategy. A positive percentage 50-day moving average indicates that the stock is trading at a price higher than its 50-day moving average level, indicating an uptrend.
Moreover, AAII found that Driehaus primarily focuses on strong earnings growth rates and impressive earnings projections to pick potential outperformers. Companies with a strong history of beating estimates are also given importance in this strategy, which was made to provide better returns over the long term.
Here are three of the 16 stocks:
RLI is a specialty property-casualty underwriter that caters primarily to niche markets through its main operating subsidiary, RLI Insurance Company. RLI has a Momentum Score of A. The trailing four-quarter earnings surprise for RLI is 43.5%, on average. MamaMancini's Holdings is involved in the manufacturing and distribution of food products primarily in the United States. MMMB has a Momentum Score of B. The trailing four-quarter earnings surprise for MMMB is 250%, on average. Evolution Petroleum is a development stage company formed to acquire and develop oil and gas fields. EPM has a Momentum Score of A. The trailing four-quarter earnings surprise for EPM is 38.4%, on average.
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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/2121895/3-momentum-stocks-worth-a-buy-backed-by-the-driehaus-strategy 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
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