We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Since we have entered the Q4 reporting cycle, looking for stocks with unswerving earnings growth is the highest priority for astute investors. And why not? If the company doesn’t make money, it won’t last over the long haul. Consider a company’s revenues over a given period of time, subtract the cost of production and you have earnings.
This metric is also considered to be the most noteworthy variable in influencing the share price. Better-than-expected earnings performances normally lead to a rally in the share price. However, in addition to actual earnings, expectations of earnings play a significant role in influencing the price of a stock.
Earnings Estimates Shape Share Prices
We have often seen a decline in the stock price despite earnings growth and a rally in the price following an earnings decline. This is largely a result of a company’s earnings failing to meet market expectations.
Earnings estimates embody analysts’ opinions of factors such as sales growth, product demand, competitive industry environment, profit margins and cost controls. Thus, earnings estimates serve as a valuable tool while taking investment decisions. Earnings estimates also help analysts assess the cash flow to determine the fair value of a firm.
As the earnings season picks up pace, investors should be on the lookout for stocks that are ready to make a big move. Hence, it is important for investors to invest in stocks that have historical earnings growth and are also seeing a rise in quarterly and annual earnings estimates.
The Winning Strategy
In order to shortlist stocks that have striking earnings growth and positive estimate revisions, we have added the following parameters:
Zacks Rank equal to 1 (Only Zacks' 'Strong Buys' are allowed. With the Zacks Rank proving itself to be one of the best rating systems out there, this is a great way to start things off.) You can see the complete list of today’s Zacks #1 Rank stocks here.
5-Year Historical EPS Growth (%) greater than X-Industry (Stocks that possess strong EPS growth history.)
% Change EPS F(0)/F(-1) greater than or equal to 5 (Companies that witnessed year-over-year earnings growth rate of 5% or more in the last reported fiscal.)
% Change Q1 Estimates over the last 4 weeks greater than zero (Stocks that have seen their current quarter earnings estimates revised higher in the last 4 weeks.)
% Change F1 Estimates over the last 1 week greater than zero (Stocks that have seen their annual earnings estimates revised higher in the last 1 week.)
% Change F1 Estimates over the last 4 weeks greater than zero (Stocks that have seen their annual earnings estimates revised higher in the last 4 weeks.)
The above criteria narrowed down the universe of around 7,818 stocks to only 31.
Here are the top five stocks:
Best Buy Co. (BBY - Free Report) operates as a retailer of technology products, services, and solutions in the United States, Canada, and Mexico. The company’s estimated growth rate for this year is 13.5%, higher than the industry’s gain of 2.3%. The Zacks Consensus Estimate for its current-year earnings increased 0.5% in the last 60 days.
AbbVie (ABBV - Free Report) discovers, develops, manufactures and sells pharmaceutical products worldwide. The company’s estimated growth rate for this year is 31.9%, higher than the industry’s gain of 9.1%. The Zacks Consensus Estimate for its current-year earnings increased 12.7% in the last 60 days.
Neogen (NEOG - Free Report) develops, manufactures, and markets various products for food and animal safety worldwide. The company’s estimated growth rate for this year is 27.9%, higher than the industry’s gain of 13.2%. The Zacks Consensus Estimate for its current-year earnings increased 12.2% in the last 60 days.
D.R. Horton (DHI - Free Report) operates as a homebuilding company in East, Midwest, Southeast, South Central, Southwest and West America. The company’s estimated growth rate for this year is 28.8%, higher than the industry’s gain of 16.4%. The Zacks Consensus Estimate for its current-year earnings increased 10.3% in the last 60 days.
State Bank Financial operates as the bank holding company for State Bank and Trust Company that provides various community banking services to individuals and businesses. The company’s estimated growth rate for this year is 41.8%, higher than the industry’s gain of 26.9%. The Zacks Consensus Estimate for its current-year earnings increased 12.5% in the last 60 days.
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.
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 »
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
5 Top Earnings Growth Stocks to Buy in February
Since we have entered the Q4 reporting cycle, looking for stocks with unswerving earnings growth is the highest priority for astute investors. And why not? If the company doesn’t make money, it won’t last over the long haul. Consider a company’s revenues over a given period of time, subtract the cost of production and you have earnings.
This metric is also considered to be the most noteworthy variable in influencing the share price. Better-than-expected earnings performances normally lead to a rally in the share price. However, in addition to actual earnings, expectations of earnings play a significant role in influencing the price of a stock.
Earnings Estimates Shape Share Prices
We have often seen a decline in the stock price despite earnings growth and a rally in the price following an earnings decline. This is largely a result of a company’s earnings failing to meet market expectations.
Earnings estimates embody analysts’ opinions of factors such as sales growth, product demand, competitive industry environment, profit margins and cost controls. Thus, earnings estimates serve as a valuable tool while taking investment decisions. Earnings estimates also help analysts assess the cash flow to determine the fair value of a firm.
As the earnings season picks up pace, investors should be on the lookout for stocks that are ready to make a big move. Hence, it is important for investors to invest in stocks that have historical earnings growth and are also seeing a rise in quarterly and annual earnings estimates.
The Winning Strategy
In order to shortlist stocks that have striking earnings growth and positive estimate revisions, we have added the following parameters:
Zacks Rank equal to 1 (Only Zacks' 'Strong Buys' are allowed. With the Zacks Rank proving itself to be one of the best rating systems out there, this is a great way to start things off.) You can see the complete list of today’s Zacks #1 Rank stocks here.
5-Year Historical EPS Growth (%) greater than X-Industry (Stocks that possess strong EPS growth history.)
% Change EPS F(0)/F(-1) greater than or equal to 5 (Companies that witnessed year-over-year earnings growth rate of 5% or more in the last reported fiscal.)
% Change Q1 Estimates over the last 4 weeks greater than zero (Stocks that have seen their current quarter earnings estimates revised higher in the last 4 weeks.)
% Change F1 Estimates over the last 1 week greater than zero (Stocks that have seen their annual earnings estimates revised higher in the last 1 week.)
% Change F1 Estimates over the last 4 weeks greater than zero (Stocks that have seen their annual earnings estimates revised higher in the last 4 weeks.)
The above criteria narrowed down the universe of around 7,818 stocks to only 31.
Here are the top five stocks:
Best Buy Co. (BBY - Free Report) operates as a retailer of technology products, services, and solutions in the United States, Canada, and Mexico. The company’s estimated growth rate for this year is 13.5%, higher than the industry’s gain of 2.3%. The Zacks Consensus Estimate for its current-year earnings increased 0.5% in the last 60 days.
AbbVie (ABBV - Free Report) discovers, develops, manufactures and sells pharmaceutical products worldwide. The company’s estimated growth rate for this year is 31.9%, higher than the industry’s gain of 9.1%. The Zacks Consensus Estimate for its current-year earnings increased 12.7% in the last 60 days.
Neogen (NEOG - Free Report) develops, manufactures, and markets various products for food and animal safety worldwide. The company’s estimated growth rate for this year is 27.9%, higher than the industry’s gain of 13.2%. The Zacks Consensus Estimate for its current-year earnings increased 12.2% in the last 60 days.
D.R. Horton (DHI - Free Report) operates as a homebuilding company in East, Midwest, Southeast, South Central, Southwest and West America. The company’s estimated growth rate for this year is 28.8%, higher than the industry’s gain of 16.4%. The Zacks Consensus Estimate for its current-year earnings increased 10.3% in the last 60 days.
State Bank Financial operates as the bank holding company for State Bank and Trust Company that provides various community banking services to individuals and businesses. The company’s estimated growth rate for this year is 41.8%, higher than the industry’s gain of 26.9%. The Zacks Consensus Estimate for its current-year earnings increased 12.5% in the last 60 days.
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
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 »