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Take the Zacks Approach to Beat the Market: Boeing, McDonald's, Monster Beverage in Focus
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All of the three widely followed indexes snapped a 9-week winning streak to close lower last week. The Dow Jones Industrial Average, the S&P 500 and the tech-heavy Nasdaq Composite lost 0.6%, 1.5% and 3.3%, respectively.
Investors’ mood was cautious to start off the year, with the market correcting itself from the overbought position it was in after a couple of blockbuster months at the end of 2023. While robust jobs data released during the week deflated expectations of rapidly easing interest rates, a slowing services sector pointed toward the Fed policy-tightening taking effect, thus balancing out market expectations.
The Fed currently expects interest rates to be 4.6% by the end of 2024, down from the 5.1% it had projected earlier. However, investors will continue to keep a watch on incoming data to gauge the situation.
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:
CVRx and Aspen Aerogels Surge Following Zacks Rank Upgrade
Shares of CVRx, Inc. (CVRX - Free Report) have gained 129.5% (versus the S&P 500’s 12.5% increase) since it was upgraded to a Zacks Rank #2 (Buy) on November 1.
Another stock, Aspen Aerogels, Inc. (ASPN - Free Report) , which was upgraded to a Zacks Rank #2 on November 3, has returned 68.8% (versus the S&P 500’s 8.6% 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.
A hypothetical portfolio of Zacks Rank #1 (Strong Buy) stocks returned +15.47% this year (through November 4th, 2023) vs. +21.03% for the S&P 500 index and +6.9% for the equal-weight S&P 500 index. The portfolio 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 concentrated performance of mega-cap stocks in 2023.
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. Looked at this way, this portfolio has handily outperformed the index.
The Zacks Model Portfolio - consisting of Zacks Rank #1 stocks – has outperformed the S&P index by more than 13 percentage points since 1988 (Through November 4th, 2023, the Zacks # 1 Rank stocks generated an annualized return of +24.04% since 1988 vs. +10.78% for the S&P 500 index). You can see the complete list of today’s Zacks Rank #1 stocks here >>>
Zacks Recommendation Upgrades Amalgamated Financial and Universal Stainless Higher
Shares of Amalgamated Financial Corp. (AMAL - Free Report) and Universal Stainless & Alloy Products, Inc. (USAP - Free Report) have advanced 41.1% (versus the S&P 500’s 8.6% rise) and 40.7% (versus the S&P 500’s 13.9% rise) since their Zacks Recommendation was upgraded to Outperform on November 3 and October 30, 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 Shopify, Boeing Shoot Up
Shares of Shopify Inc. (SHOP - Free Report) , which belongs to the Zacks Focus List, have gained 44.5% over the past 12 weeks. The stock was added to the Focus List on September 6, 2022. Another Focus-List holding, The Boeing Company (BA - Free Report) , which was added to the portfolio on March 23, 2020, has returned 34.7% over the past 12 weeks. The S&P 500 has advanced 8.4% over this period.
The 50-stock Zacks Focus List model portfolio returned +21.72% in 2023 (through November 30th) vs. +20.79% for the S&P 500 index and +6.32% for the equal-weight S&P 500 index. In 2022, the portfolio produced -15.2% vs. the S&P 500 index’s -17.96%.
Since 2004, the Focus List portfolio has produced an annualized return of +11.07% through November 30th, 2023. This compares to a +9.49% annualized return for the S&P 500 index in the same time period.
On a rolling one-, three- and five-year annualized basis, the Zacks Focus List returned +13.49%, +9.21%, and +14.05% vs. +13.82%, +9.74% and +12.51% 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 Fair Isaac and Monster Beverage Make Significant Gains
Fair Isaac Corporation (FICO - Free Report) , a component of our Earnings Certain Admiral Portfolio (ECAP), has jumped 24.6% over the past 12 weeks. Monster Beverage Corporation (MNST - Free Report) has followed Fair Isaac with 20.6% returns.
The Zacks Earnings Certain Admiral Portfolio (ECAP), which consists of 30 concentrated, ultra-defensive, long-term Buy and Hold stocks, returned +12.17% in 2023 vs. +26.28% for the S&P 500 index. The portfolio returned -4.7% in 2022 vs. 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 American Tower and McDonald's Outperform Peers
American Tower Corporation (AMT - Free Report) , which is part of our Earnings Certain Dividend Portfolio (ECDP), has returned 28.3% over the past 12 weeks. Another ECDP stock, McDonald's Corporation (MCD - Free Report) , has climbed 16.4% 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.
The Zacks Earnings Certain Dividend Portfolio (ECDP) returned -0.9% in 2023 vs. +26.28% for the S&P 500 index) and +8.11% for the Dividend Aristocrats ETF (NOBL). The portfolio returned -2.3% in 2022 vs. -17.96% for the S&P 500 index and -8.34% for NOBL.
Sprouts Farmers Market, Inc. (SFM - Free Report) , from the Zacks Top 10 Stocks for 2024, has jumped 2.3% since the list was released on January 2 against a 1.6% decrease for the S&P 500 Index.
The Top 10 portfolio returned +25.15% in 2023 vs. +26.28% for the S&P 500 index. Since 2012, the Top 10 portfolio has produced a cumulative return of +1060.9% through the end of 2023 vs. +360.1% for the S&P 500 index.
On a rolling one-, three- and five-year annualized basis, the Zacks Top 10 portfolio returned +25.15%, +14.13%, and +29.3% vs. +26.28%, +10.23% and +15.61% for the S&P 500 index, respectively.
Since 2012, the Zacks Top 10 portfolio has returned an annualized return of +22.67% through the end of 2023 vs. +13.56% for the S&P 500 index.
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Take the Zacks Approach to Beat the Market: Boeing, McDonald's, Monster Beverage in Focus
All of the three widely followed indexes snapped a 9-week winning streak to close lower last week. The Dow Jones Industrial Average, the S&P 500 and the tech-heavy Nasdaq Composite lost 0.6%, 1.5% and 3.3%, respectively.
Investors’ mood was cautious to start off the year, with the market correcting itself from the overbought position it was in after a couple of blockbuster months at the end of 2023. While robust jobs data released during the week deflated expectations of rapidly easing interest rates, a slowing services sector pointed toward the Fed policy-tightening taking effect, thus balancing out market expectations.
The Fed currently expects interest rates to be 4.6% by the end of 2024, down from the 5.1% it had projected earlier. However, investors will continue to keep a watch on incoming data to gauge the situation.
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:
CVRx and Aspen Aerogels Surge Following Zacks Rank Upgrade
Shares of CVRx, Inc. (CVRX - Free Report) have gained 129.5% (versus the S&P 500’s 12.5% increase) since it was upgraded to a Zacks Rank #2 (Buy) on November 1.
Another stock, Aspen Aerogels, Inc. (ASPN - Free Report) , which was upgraded to a Zacks Rank #2 on November 3, has returned 68.8% (versus the S&P 500’s 8.6% 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.
A hypothetical portfolio of Zacks Rank #1 (Strong Buy) stocks returned +15.47% this year (through November 4th, 2023) vs. +21.03% for the S&P 500 index and +6.9% for the equal-weight S&P 500 index. The portfolio 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 concentrated performance of mega-cap stocks in 2023.
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. Looked at this way, this portfolio has handily outperformed the index.
The Zacks Model Portfolio - consisting of Zacks Rank #1 stocks – has outperformed the S&P index by more than 13 percentage points since 1988 (Through November 4th, 2023, the Zacks # 1 Rank stocks generated an annualized return of +24.04% since 1988 vs. +10.78% for the S&P 500 index). You can see the complete list of today’s Zacks Rank #1 stocks here >>>
Check CVRx’s historical EPS and Sales here>>>
Check Aspen Aerogels’ historical EPS and Sales here>>>
Image Source: Zacks Investment Research
Zacks Recommendation Upgrades Amalgamated Financial and Universal Stainless Higher
Shares of Amalgamated Financial Corp. (AMAL - Free Report) and Universal Stainless & Alloy Products, Inc. (USAP - Free Report) have advanced 41.1% (versus the S&P 500’s 8.6% rise) and 40.7% (versus the S&P 500’s 13.9% rise) since their Zacks Recommendation was upgraded to Outperform on November 3 and October 30, 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 Shopify, Boeing Shoot Up
Shares of Shopify Inc. (SHOP - Free Report) , which belongs to the Zacks Focus List, have gained 44.5% over the past 12 weeks. The stock was added to the Focus List on September 6, 2022. Another Focus-List holding, The Boeing Company (BA - Free Report) , which was added to the portfolio on March 23, 2020, has returned 34.7% over the past 12 weeks. The S&P 500 has advanced 8.4% over this period.
The 50-stock Zacks Focus List model portfolio returned +21.72% in 2023 (through November 30th) vs. +20.79% for the S&P 500 index and +6.32% for the equal-weight S&P 500 index. In 2022, the portfolio produced -15.2% vs. the S&P 500 index’s -17.96%.
Since 2004, the Focus List portfolio has produced an annualized return of +11.07% through November 30th, 2023. This compares to a +9.49% annualized return for the S&P 500 index in the same time period.
On a rolling one-, three- and five-year annualized basis, the Zacks Focus List returned +13.49%, +9.21%, and +14.05% vs. +13.82%, +9.74% and +12.51% 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 Fair Isaac and Monster Beverage Make Significant Gains
Fair Isaac Corporation (FICO - Free Report) , a component of our Earnings Certain Admiral Portfolio (ECAP), has jumped 24.6% over the past 12 weeks. Monster Beverage Corporation (MNST - Free Report) has followed Fair Isaac with 20.6% returns.
The Zacks Earnings Certain Admiral Portfolio (ECAP), which consists of 30 concentrated, ultra-defensive, long-term Buy and Hold stocks, returned +12.17% in 2023 vs. +26.28% for the S&P 500 index. The portfolio returned -4.7% in 2022 vs. 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 American Tower and McDonald's Outperform Peers
American Tower Corporation (AMT - Free Report) , which is part of our Earnings Certain Dividend Portfolio (ECDP), has returned 28.3% over the past 12 weeks. Another ECDP stock, McDonald's Corporation (MCD - Free Report) , has climbed 16.4% 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 American Tower’s dividend history here>>>
Check McDonalds’ 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.
The Zacks Earnings Certain Dividend Portfolio (ECDP) returned -0.9% in 2023 vs. +26.28% for the S&P 500 index) and +8.11% for the Dividend Aristocrats ETF (NOBL). The portfolio returned -2.3% in 2022 vs. -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 — Sprouts Farmers Market Delivers Solid Returns
Sprouts Farmers Market, Inc. (SFM - Free Report) , from the Zacks Top 10 Stocks for 2024, has jumped 2.3% since the list was released on January 2 against a 1.6% decrease for the S&P 500 Index.
The Top 10 portfolio returned +25.15% in 2023 vs. +26.28% for the S&P 500 index. Since 2012, the Top 10 portfolio has produced a cumulative return of +1060.9% through the end of 2023 vs. +360.1% for the S&P 500 index.
On a rolling one-, three- and five-year annualized basis, the Zacks Top 10 portfolio returned +25.15%, +14.13%, and +29.3% vs. +26.28%, +10.23% and +15.61% for the S&P 500 index, respectively.
Since 2012, the Zacks Top 10 portfolio has returned an annualized return of +22.67% through the end of 2023 vs. +13.56% for the S&P 500 index.