Back to top

Image: Shutterstock

Beat the Market Like Zacks: Elementis, Novo Nordisk, Amgen in Focus

Read MoreHide Full Article

All three widely followed indexes closed a losing week last Friday. The Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite declined 1.9%, 2.9% and 3.6%, respectively. For the S&P 500 and Nasdaq, it was the largest weekly percentage fall since March.

The Fed turned hawkish after its September meeting, and chairman Jerome Powell indicated that he expects at least another hike by year-end. The general suggestion was that the policy required further tightening because the current level of inflation still needs to be brought down to the Fed’s 2% target. Investor optimism took a hit, and trade suffered through the week.

The treasury yield also hit a 16-year high, and whether the central bank could attain a soft landing for the economy is up for debate again. However, some good news came from the automobile sector with a breakthrough in talks between the Big Three automakers and the striking UAW representatives.

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:

Elementis and Boise Cascade Surge Following Zacks Rank Upgrade

Shares of Elementis plc (ELMTY - Free Report) have gained 21.7% (versus the S&P 500’s 2.1% decrease) since it was upgraded to a Zacks Rank #2 (Buy) on July 12.

Another stock, Boise Cascade Company (BCC - Free Report) , which was upgraded to a Zacks Rank #1 (Strong Buy) on July 11, has returned 7.2% (versus the S&P 500’s 1.4% decrease) 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 stocks has returned +10.8% this year (through July 3) versus +16.1% for the S&P 500 Index and +7.7% for the equal-weight S&P 500 Index. The set of Zacks Rank #1 stocks is an equal-weight portfolio, while the S&P 500 Index is a market-cap-weighted index that has been notably distorted by the strong recent performance of mega-cap stocks.

We are not trying to cherry-pick here. But since this Zacks Model portfolio, consisting of Zacks Rank # 1 stocks, is an equal-weight portfolio, the equal-weight S&P 500 Index is the appropriate benchmark for comparison.

Check Elementis’ historical EPS and Sales here>>>

Check Boise Cascade’s historical EPS and Sales here>>>

Zacks Investment Research
Image Source: Zacks Investment Research

Zacks Recommendation Upgrade Drives Sabre and Samsonite Higher 

Shares of Sabre Corporation (SABR - Free Report) and Samsonite International S.A. (SMSEY - Free Report) have advanced 13.4% (versus the S&P 500’s 3.8% fall) and 11.2% (versus the S&P 500’s 2.1% fall) since their Zacks Recommendation was upgraded to Outperform on July 14 and July 12, respectively.

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 Novo Nordisk, Broadridge Financial Shoot Up

Shares of Novo Nordisk A/S (NVO - Free Report) , which belongs to the Zacks Focus List, have risen 16.3% over the past 12 weeks. The stock was added to the Focus List on March 7, 2023. Another Focus-List holding, Broadridge Financial Solutions, Inc. (BR - Free Report) , which was added to the portfolio on August 29, 2017, has returned 12.8% over the past 12 weeks. The S&P 500 has lost 2.5% 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 has returned +17.15% in 2023 (through June 30) versus +16.90% 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 +11.10% through June 30, 2023. This compares to a +9.52% annualized return for the S&P 500 Index in the same period.

On rolling one-, three- and five-year bases, the Zacks Focus List returned +29.36%, +16.74% and +12.45% versus +19.57%, +14.59% and +12.30% for the S&P 500 Index, respectively.

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 Amgen and MSCI Make Significant Gains

Amgen Inc. (AMGN - Free Report) , a component of our Earnings Certain Admiral Portfolio (ECAP), has jumped 21% over the past 12 weeks. MSCI Inc. (MSCI - Free Report) has followed Amgen with 11.1% returns.

ECAP, which consists of 30 concentrated, ultra-defensive, long-term Buy and Hold stocks, has returned +6.67% in 2023 (through June 30) versus +16.90% 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 Paychex and Procter & Gamble Outperform Peers 

Paychex, Inc. (PAYX - Free Report) , which is part of our Earnings Certain Dividend Portfolio (ECDP), has returned 3.3% over the past 12 weeks. Another ECDP stock, The Procter & Gamble Company (PG - Free Report) , has climbed 1.5% 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 Paychex’s dividend history here>>>

Check Procter & Gamble’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 has returned +0.18% in 2023 (through June 30) versus +16.90% for the S&P 500 Index. The portfolio returned -2.3% in 2022 versus -17.96% for the S&P 500 Index and -8.34% for the ProShares S&P 500 Dividend Aristocrats ETF (NOBL - Free Report) .

Click here to access this portfolio on Zacks Advisor Tools.  

Zacks Top 10 Stocks — Celsius Delivers Solid Returns

Celsius Holdings, Inc. (CELH - Free Report) , from the Zacks Top 10 Stocks for 2023, has gained 61% year to date compared with a 13.8% rise for the S&P 500 Index.

The portfolio returned +15.9% through the end of June 2023 versus +16.9% for the S&P 500 (the equal-weighted index, a more appropriate benchmark, returned +7% in the same 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 through May 31, 2023, the Zacks Top 10 Stocks produced a cumulative return of +827.6% through the end of 2022 vs. +265% for the S&P 500 index.

Published in