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The Zacks Analyst Blog Highlights VirTra, REX American Resources, Universal Stainless & Alloy Products, Runway Growth Finance and Carrols Restaurant Group
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For Immediate Release
Chicago, IL – January 5, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: VirTra (VTSI - Free Report) , REX American Resources (REX - Free Report) , Universal Stainless & Alloy Products (USAP - Free Report) , Runway Growth Finance Corp. (RWAY - Free Report) and Carrols Restaurant Group (TAST - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
5 Top-Ranked Small-Cap Stocks to Rally Hard in 2024
For the stock market, 2023 has been a phenomenal year, with the Dow ending at a record high and the S&P 500 finishing close to a similar milestone. The tech-laden Nasdaq also posted solid gains in 2023 after witnessing a dismal 2022.
However, most of the gains in the stock market were due to the uptick in mega-cap technology stocks, better known as Magnificent Seven. The group, which consists of behemoths such as Apple, Amazon, Alphabet, Microsoft , Meta Platforms, Nvidia and Tesla, has contributed more than 50% of the S&P 500's total return in 2023.
But unlike 2023's seven growth stories, this year could be completely different, with predominantly small-caps stocks sensitive to the interest rate cycles, well-poised to play catch-up.
Last year, the Russell 2000 index of small-cap stocks gained 15.5%, less than the S&P 500's growth of 24%. However, the Russell 2000 soared 12.4% in December and easily outpaced the large-cap benchmark's 4.1% rise, a tell-tale sign that small-caps have ended 2023 on an encouraging note and are about to rally hard in 2024.
And why not? The Federal Reserve's dovish outlook certainly bodes well for small-cap players. The Fed has decided to curb its monetary tightening measures as inflation has started to see signs of cooling down amid a resilient economy.
The Fed has kept its benchmark fed funds rate unaltered in its latest Federal Open Market Committee meeting and hinted at three interest rate cuts this year, with the first one expected in March (read more: 5 Top Stocks to Gain From Lower Interest Rates in 2024).
Interest rate hikes adversely impact small-caps since they have weaker balance sheets and higher levels of debt compared to their large-cap peers. Interest rate hikes no doubt increase their cost of borrowing, which in due course affects their profit margins. Notably, small-cap companies have been hit hard since 2022, when the Fed raised interest rates 11 times to tame unswerving price pressures.
History also shows that small caps are about to make a comeback in 2024. Royce Investment Partners' co-chief investment officer Francis Gannon stated that the Russell 2000 index has always posted an average annualized return of 14.9% for five years after lower-than-average return periods. The Russell 2000 has witnessed an average annualized return of 2.4% for five years ending on Sep 30, the lowest five-year return since the index's inception.
Therefore, it's prudent for astute investors to place bets on small-cap growth stocks like VirTra, REX American Resources, Universal Stainless & Alloy Products, Runway Growth Finance Corp. and Carrols Restaurant Group for stellar returns in the new year.
VirTra manufactures and sells personal computers and non-personal computer-based products. VirTra currently has a Growth Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up 39.1% over the past 60 days. VTSI's expected earnings growth rate for the current year is 255.6%.
REX American Resources is engaged in the production and sale of ethanol and distiller grains. REX American Resources currently has a Growth Score of A.
The Zacks Consensus Estimate for its current-year earnings has moved up 22.8% over the past 60 days. REX's expected earnings growth rate for the current year is 98.7%.
Universal Stainless & Alloy Products is a mini-mill that manufactures and markets semi-finished specialty steels. USAP currently has a Growth Score of A.
The Zacks Consensus Estimate for its current-year earnings has moved up 15.6% over the past 90 days. USAP's expected earnings growth rate for the current year is 170.3%.
Runway Growth Finance is an externally managed business development company. RWAY currently has a Growth Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up 5.9% over the past 60 days. RWAY's expected earnings growth rate for the current year is 36.3%.
Carrols Restaurant is the largest BURGER KING franchisee in the United States. The company currently has a Growth Score of A.
The Zacks Consensus Estimate for its current-year earnings has moved up 29.7% over the past 60 days. TAST's expected earnings growth rate for the current year is 168.6%.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights VirTra, REX American Resources, Universal Stainless & Alloy Products, Runway Growth Finance and Carrols Restaurant Group
For Immediate Release
Chicago, IL – January 5, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: VirTra (VTSI - Free Report) , REX American Resources (REX - Free Report) , Universal Stainless & Alloy Products (USAP - Free Report) , Runway Growth Finance Corp. (RWAY - Free Report) and Carrols Restaurant Group (TAST - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
5 Top-Ranked Small-Cap Stocks to Rally Hard in 2024
For the stock market, 2023 has been a phenomenal year, with the Dow ending at a record high and the S&P 500 finishing close to a similar milestone. The tech-laden Nasdaq also posted solid gains in 2023 after witnessing a dismal 2022.
However, most of the gains in the stock market were due to the uptick in mega-cap technology stocks, better known as Magnificent Seven. The group, which consists of behemoths such as Apple, Amazon, Alphabet, Microsoft , Meta Platforms, Nvidia and Tesla, has contributed more than 50% of the S&P 500's total return in 2023.
But unlike 2023's seven growth stories, this year could be completely different, with predominantly small-caps stocks sensitive to the interest rate cycles, well-poised to play catch-up.
Last year, the Russell 2000 index of small-cap stocks gained 15.5%, less than the S&P 500's growth of 24%. However, the Russell 2000 soared 12.4% in December and easily outpaced the large-cap benchmark's 4.1% rise, a tell-tale sign that small-caps have ended 2023 on an encouraging note and are about to rally hard in 2024.
And why not? The Federal Reserve's dovish outlook certainly bodes well for small-cap players. The Fed has decided to curb its monetary tightening measures as inflation has started to see signs of cooling down amid a resilient economy.
The Fed has kept its benchmark fed funds rate unaltered in its latest Federal Open Market Committee meeting and hinted at three interest rate cuts this year, with the first one expected in March (read more: 5 Top Stocks to Gain From Lower Interest Rates in 2024).
Interest rate hikes adversely impact small-caps since they have weaker balance sheets and higher levels of debt compared to their large-cap peers. Interest rate hikes no doubt increase their cost of borrowing, which in due course affects their profit margins. Notably, small-cap companies have been hit hard since 2022, when the Fed raised interest rates 11 times to tame unswerving price pressures.
History also shows that small caps are about to make a comeback in 2024. Royce Investment Partners' co-chief investment officer Francis Gannon stated that the Russell 2000 index has always posted an average annualized return of 14.9% for five years after lower-than-average return periods. The Russell 2000 has witnessed an average annualized return of 2.4% for five years ending on Sep 30, the lowest five-year return since the index's inception.
Therefore, it's prudent for astute investors to place bets on small-cap growth stocks like VirTra, REX American Resources, Universal Stainless & Alloy Products, Runway Growth Finance Corp. and Carrols Restaurant Group for stellar returns in the new year.
These stocks have a Zacks Rank #1 (Strong Buy) and a Growth Score of A or B, a combination that offers the best opportunities in the growth investing space. You can see the complete list of today's Zacks Rank #1 stocks here.
VirTra manufactures and sells personal computers and non-personal computer-based products. VirTra currently has a Growth Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up 39.1% over the past 60 days. VTSI's expected earnings growth rate for the current year is 255.6%.
REX American Resources is engaged in the production and sale of ethanol and distiller grains. REX American Resources currently has a Growth Score of A.
The Zacks Consensus Estimate for its current-year earnings has moved up 22.8% over the past 60 days. REX's expected earnings growth rate for the current year is 98.7%.
Universal Stainless & Alloy Products is a mini-mill that manufactures and markets semi-finished specialty steels. USAP currently has a Growth Score of A.
The Zacks Consensus Estimate for its current-year earnings has moved up 15.6% over the past 90 days. USAP's expected earnings growth rate for the current year is 170.3%.
Runway Growth Finance is an externally managed business development company. RWAY currently has a Growth Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up 5.9% over the past 60 days. RWAY's expected earnings growth rate for the current year is 36.3%.
Carrols Restaurant is the largest BURGER KING franchisee in the United States. The company currently has a Growth Score of A.
The Zacks Consensus Estimate for its current-year earnings has moved up 29.7% over the past 60 days. TAST's expected earnings growth rate for the current year is 168.6%.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.