Back to top

Press Releases

Zacks Equity Research

Zacks.com featured highlights: Cisco Systems, Cardiovascular Systems, Five9, Generac Holdings and Nxstage Medical

CSCO CSII FIVN GNRC NXTM

Trades from $3

For Immediate Release

Chicago, IL – November 16, 2016 - Stocks in this week’s article include Cisco Systems (NASDAQ:(CSCO - Free Report) –Free Report),Cardiovascular Systems (NASDAQ:(CSII - Free Report) –Free Report),Five9, Inc. (NASDAQ:(FIVN - Free Report) –Free Report),Generac Holdings (NYSE:(GNRC - Free Report) –Free Report) and Nxstage Medical (NASDAQ:(NXTM - Free Report) – Free Report).

Screen of the Week of Zacks Investment Research by Kevin Matras:

Top Stocks with Big Potential Catch-up Moves

Given the recent run-up in the market last week, here's a screen I've been using recently for my own stock picking.

First, it focuses on the top Zacks Ranked Sectors and Industries. Then it focuses on the Zacks Rank #1s, #2s and #3s, which are Strong Buys, Buys and Holds, respectively. But then it selects the outperforming stocks with the smallest percentage price change over the last 4 weeks.

Why would I do something like that?

Here's why.

You've probably heard the old adage that roughly half of a stock's price movement can be attributed to the group that it's in. And that's true. In fact, oftentimes, even a mediocre stock in a top group will outperform a top stock in a poor group for this very reason.

Now, take a look at any top group. You'll see plenty of fantastic stocks with some impressive price gains in there. But not every stock in every group moves in lockstep at the exact same time. Some will move more than others at any given time.

So by focusing on the stocks with the smallest percentage price change with fundamentals that are just as good as those making the biggest price change, you might find yourself getting into the stocks ready to make the biggest potential catch-up move.

Here's how to set up that screen:

Best Zacks Ranked Sectors -- Best 8
We're screening for only those stocks with the best (lowest) average Zacks Rank. With 16 sectors, the best 8 sectors give us the best 50% of sectors.

Best Zacks Ranked Industries -- Best 132
Next step is to get only the best Zacks Ranked Industries coming thru. Since there are 264 'X' or expanded industries we look at, the best 132 will give us the best 50% of industries. But note that only the industries that also happen to be in the top sectors will get thru. If an industry is ranked as one of the best but it's outside of the top sector rank, it will not get thru.

Zacks Rank less than or equal to 2
Now the screen gets narrowed down even more by looking at only the Zacks Rank #1s, #2s. Only Strong Buys and Buys can get through.

Price and Avg. Volume greater than or equal to $5 and 100,000 shares
Only stocks over $5 with at least an average of 100,0000 shares traded daily will be considered.

Relative % Price Change -- 4 Weeks greater than 0
This means we're screening for only those stocks that have outperformed the market (S&P 500) over the last 4 weeks.

% Change in Price -- 4 Weeks: Bottom 50
Then finally we're scanning for the bottom 50 stocks with the lowest percentage price change over the last 4 weeks. So while all of these stocks have outperformed the market, they increased in price less than their peers.

So each one of these stocks is in a top Sector and top Industry within that Sector. This alone will tip the odds of success in your favor by a great deal when you consider that the best Zacks Ranked groups outperform the worst ones by a factor of 2 to 1.

Then by selecting those stocks with the best Zacks Rank along with the best price performance over the last 4 weeks, you now have only a list of winners from which to choose from.

And from that list of winners, we're selecting the ones that have gained less than their peers on that list. Remember, these stocks aren’t 'dogs' or unresponsive stocks. Quite the contrary; they have all outperformed the market. It just so happens that they increased less than the others on the list. But because they are a top rated stock in a top rated industry, we've singled these out as the ones that could make the biggest move to 'catch-up' to the others.

It's an interesting screen that has generated a lot of great names.

Here are 5 from that list:

(NASDAQ:(CSCO - Free Report) – Free Report) Cisco Systems
(NASDAQ:(CSII - Free Report) – Free Report) Cardiovascular Systems
(NASDAQ:(FIVN - Free Report) – Free Report) Five9, Inc.
(NYSE:(GNRC - Free Report) – Free Report) Generac Holdings
(NASDAQ:(NXTM - Free Report) – Free Report) Nxstage Medical

All great looking stocks that seem to have lots more upside in store for them.

Get the rest of the stocks on the list and start putting this and other ideas to the test. It can all be done with the Research Wizard stock picking and backtesting software.

The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.

Click here to sign up for a free trial to the Research Wizard today .

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.

Disclosure: Performance information for Zacks’ portfolios and strategies are available at: https://www.zacks.com/performance .

Zacks Restaurant Recommendations: In addition to dining at these special places, you can feast on their stock shares. A Zacks Special Report spotlights 5 recent IPOs to watch plus 2 stocks that offer immediate promise in a booming sector. Download it free »

Sign up now for your free trial today and start picking better stocks immediately. And with the backtesting feature, you can test your ideas to see how you can improve your trading in both up markets and down markets. Don’t wait for the market to get better before you decide to do better. Start learning how to be a better trader today: https://at.zacks.com/?id=111

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

Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use. Each week, Zacks Profit from the Pros free email newsletter shares a new screening strategy. Learn more about it here https://at.zacks.com/?id=112

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Click here for your free subscription to Profit from the Pros.

Get the full Report on NXTM - FREE

Get the full Report on CSCO - FREE

Get the full Report on CSII - FREE

Get the full Report on FIVN - FREE

Get the full Report on GNRC - FREE

Follow us on Twitter: https://twitter.com/zacksresearch

Join us on Facebook: https://www.facebook.com/ZacksInvestmentResearch

Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.

Contact: Jim Giaquinto
Company: Zacks.com
Phone: 312-265-9268
Email: pr@zacks.com

Visit: https://www.zacks.com/performance

Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer .

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.