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Why Relative Price Strength Matters More Heading Into 2026
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Key Takeaways
Stocks like JBL, CIEN, CMC and PAA are outperforming the S&P 500 across 1-, 4-, and 12-week periods.
All four stocks have seen upward Q1 earnings revisions over the past 4 weeks and hold a Zacks Rank of 1.
Each company also carries a VGM Score of A or B, signaling strong value, growth and momentum profiles.
U.S. stocks are entering the new year with strong momentum after several years of solid gains. The rally has matured, but has not broken. Inflation has eased, growth expectations are improving, and earnings forecasts still point higher. Add in the ongoing push from artificial intelligence (AI), and 2026 is beginning with optimism rather than fear as investors remain focused on the bigger trend.
That said, the ride has not been smooth. Trade concerns, policy uncertainty, and shifting rate expectations created sharp swings along the way. Even so, cooling inflation, resilient consumers, and better-than-feared earnings have helped stocks recover quickly. Heavy investment in AI, data centers, and cloud infrastructure continues to provide a strong underlying tailwind.
As the calendar turns, relative price strength stands out as a smart strategy. Stocks already leading the market often continue to rule, making strength a useful guide in a still-constructive market.
At this stage, investors would be wise to consider stocks such as Jabil Inc. (JBL - Free Report) , Ciena Corporation (CIEN - Free Report) , Commercial Metals Company (CMC - Free Report) and Plains All American Pipeline LP (PAA - Free Report) .
Relative Price Strength Strategy
Whether a stock has the potential to offer considerable returns is determined primarily by its earnings and valuation ratios. Simultaneously, it is essential to check whether its price performance exceeds its peers or the industry average.
Upon such comparison, if we find that a stock is unable to match up to wider sectoral growth despite having impressive earnings momentum or valuation multiples, it may be better to avoid it.
However, those outperforming their respective industries or benchmarks should be included in your portfolio since they have a higher chance of securing significant returns. Picking a stock that outperforms its peers ensures a winning option on your hands.
Then again, it is imperative that you determine whether or not an investment has relevant upside potential when considering stocks with significant relative price strength. Stocks delivering better than the S&P 500 for 1 to 3 months, at least, and having solid fundamentals, indicate room for growth and the best way to go about this strategy.
Finally, it is crucial to find out whether analysts are optimistic about the upcoming earnings of these companies. In order to do this, we have added positive estimate revisions for the current quarter’s (Q1) earnings to our screen. When a stock undergoes an upward revision, it leads to additional price gains.
Screening Parameters
Relative % Price change – 12 weeks greater than 0
Relative % Price change – 4 weeks greater than 0
Relative % Price change – 1 week greater than 0
(We have considered those stocks that have been outperforming the S&P 500 over the last 12 weeks, four weeks and one week.)
% Change (Q1) Est. over 4 Weeks greater than 0: Positive current-quarter estimate revisions over the last four weeks.
Zacks Rank equal to 1: Only Zacks Rank #1 (Strong Buy) stocks — that have returned more than 26% annually over the last 26 years and surpassed the S&P 500 in 23 of the last 26 years — can get through. You can see the complete list of today’s Zacks #1 Rank stocks here.
Current Price greater than or equal to $5 and Average 20-day Volume greater than or equal to 50,000: A minimum price of $5 is a good standard to screen low-priced stocks, while a high trading volume would imply adequate liquidity.
VGM Score less than or equal to B: Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best upside potential.
Here are four of the eight stocks that made it through the screen:
Jabil Inc.: Based in Saint Petersburg, FL, it is one of the largest global suppliers of electronic manufacturing services. JBL has a market capitalization of more than $25 billion. The company has a VGM Score of A.
The Zacks Consensus Estimate for Jabil’s fiscal 2026 earnings per share indicates 18.5% year-over-year growth. Over the past 60 days, the Zacks Consensus Estimate for its fiscal 2026 earnings has moved up 4.5%. JBL shares have surged 58% in a year.
Ciena Corporation: Based in Hanover, MD, the company a leading provider of optical networking equipment, software and services. Ciena’s expected EPS growth rate for three to five years is currently 41.8%, which compares favorably with the industry's growth rate of 30%. CIEN has a VGM Score of B.
The Zacks Consensus Estimate for Ciena’s fiscal 2026 earnings per share indicates 97.7% year-over-year growth. Over the past 60 days, the Zacks Consensus Estimate for its fiscal 2026 earnings has moved up from $4.36 per share to $5.22. CIEN shares have gone up 191.2% in a year.
Commercial Metals Company: It manufactures, recycles and markets steel and metal products, related materials and services. The Zacks Consensus Estimate for fiscal 2026 earnings of the company indicates 125.2% growth. Headquartered in Irving, TX, CMC has a VGM Score of A.
The firm has a market capitalization of $8 billion. Notably, over the past 60 days, the Zacks Consensus Estimate for Commercial Metals’ fiscal 2026 earnings has moved up 21.3%. CMC’s shares have gained 42.4% in a year.
Plains All American Pipeline LP: Headquartered in Houston, TX, Plains All American Pipeline is focused on moving and storing crude oil and natural gas liquids across North America. PAA has a market capitalization of nearly $13 billion. It has a VGM Score of A.
Notably, over the past 60 days, the Zacks Consensus Estimate for Plains All American Pipeline’s 2026 earnings has moved up 6.8%. PAA beat the Zacks Consensus Estimate for earnings in two of the last four quarters and missed in the other two, with the average being 4.2%. Plains All American Pipeline units have gained 3.6% in a year.
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
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.
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.
Image: Bigstock
Why Relative Price Strength Matters More Heading Into 2026
Key Takeaways
U.S. stocks are entering the new year with strong momentum after several years of solid gains. The rally has matured, but has not broken. Inflation has eased, growth expectations are improving, and earnings forecasts still point higher. Add in the ongoing push from artificial intelligence (AI), and 2026 is beginning with optimism rather than fear as investors remain focused on the bigger trend.
That said, the ride has not been smooth. Trade concerns, policy uncertainty, and shifting rate expectations created sharp swings along the way. Even so, cooling inflation, resilient consumers, and better-than-feared earnings have helped stocks recover quickly. Heavy investment in AI, data centers, and cloud infrastructure continues to provide a strong underlying tailwind.
As the calendar turns, relative price strength stands out as a smart strategy. Stocks already leading the market often continue to rule, making strength a useful guide in a still-constructive market.
At this stage, investors would be wise to consider stocks such as Jabil Inc. (JBL - Free Report) , Ciena Corporation (CIEN - Free Report) , Commercial Metals Company (CMC - Free Report) and Plains All American Pipeline LP (PAA - Free Report) .
Relative Price Strength Strategy
Whether a stock has the potential to offer considerable returns is determined primarily by its earnings and valuation ratios. Simultaneously, it is essential to check whether its price performance exceeds its peers or the industry average.
Upon such comparison, if we find that a stock is unable to match up to wider sectoral growth despite having impressive earnings momentum or valuation multiples, it may be better to avoid it.
However, those outperforming their respective industries or benchmarks should be included in your portfolio since they have a higher chance of securing significant returns. Picking a stock that outperforms its peers ensures a winning option on your hands.
Then again, it is imperative that you determine whether or not an investment has relevant upside potential when considering stocks with significant relative price strength. Stocks delivering better than the S&P 500 for 1 to 3 months, at least, and having solid fundamentals, indicate room for growth and the best way to go about this strategy.
Finally, it is crucial to find out whether analysts are optimistic about the upcoming earnings of these companies. In order to do this, we have added positive estimate revisions for the current quarter’s (Q1) earnings to our screen. When a stock undergoes an upward revision, it leads to additional price gains.
Screening Parameters
Relative % Price change – 12 weeks greater than 0
Relative % Price change – 4 weeks greater than 0
Relative % Price change – 1 week greater than 0
(We have considered those stocks that have been outperforming the S&P 500 over the last 12 weeks, four weeks and one week.)
% Change (Q1) Est. over 4 Weeks greater than 0: Positive current-quarter estimate revisions over the last four weeks.
Zacks Rank equal to 1: Only Zacks Rank #1 (Strong Buy) stocks — that have returned more than 26% annually over the last 26 years and surpassed the S&P 500 in 23 of the last 26 years — can get through. You can see the complete list of today’s Zacks #1 Rank stocks here.
Current Price greater than or equal to $5 and Average 20-day Volume greater than or equal to 50,000: A minimum price of $5 is a good standard to screen low-priced stocks, while a high trading volume would imply adequate liquidity.
VGM Score less than or equal to B: Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best upside potential.
Here are four of the eight stocks that made it through the screen:
Jabil Inc.: Based in Saint Petersburg, FL, it is one of the largest global suppliers of electronic manufacturing services. JBL has a market capitalization of more than $25 billion. The company has a VGM Score of A.
The Zacks Consensus Estimate for Jabil’s fiscal 2026 earnings per share indicates 18.5% year-over-year growth. Over the past 60 days, the Zacks Consensus Estimate for its fiscal 2026 earnings has moved up 4.5%. JBL shares have surged 58% in a year.
Ciena Corporation: Based in Hanover, MD, the company a leading provider of optical networking equipment, software and services. Ciena’s expected EPS growth rate for three to five years is currently 41.8%, which compares favorably with the industry's growth rate of 30%. CIEN has a VGM Score of B.
The Zacks Consensus Estimate for Ciena’s fiscal 2026 earnings per share indicates 97.7% year-over-year growth. Over the past 60 days, the Zacks Consensus Estimate for its fiscal 2026 earnings has moved up from $4.36 per share to $5.22. CIEN shares have gone up 191.2% in a year.
Commercial Metals Company: It manufactures, recycles and markets steel and metal products, related materials and services. The Zacks Consensus Estimate for fiscal 2026 earnings of the company indicates 125.2% growth. Headquartered in Irving, TX, CMC has a VGM Score of A.
The firm has a market capitalization of $8 billion. Notably, over the past 60 days, the Zacks Consensus Estimate for Commercial Metals’ fiscal 2026 earnings has moved up 21.3%. CMC’s shares have gained 42.4% in a year.
Plains All American Pipeline LP: Headquartered in Houston, TX, Plains All American Pipeline is focused on moving and storing crude oil and natural gas liquids across North America. PAA has a market capitalization of nearly $13 billion. It has a VGM Score of A.
Notably, over the past 60 days, the Zacks Consensus Estimate for Plains All American Pipeline’s 2026 earnings has moved up 6.8%. PAA beat the Zacks Consensus Estimate for earnings in two of the last four quarters and missed in the other two, with the average being 4.2%. Plains All American Pipeline units have gained 3.6% in a year.
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
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.