Selecting stocks from the vast investment universe is not an easy task. For this, one has to understand the company fundamentals and try to place them against the present economic background to figure out how it may fare as an investment.
One way to cut this task out is to follow broker recommendation. Brokers have more insight into what’s happening in a particular company as they directly communicate with management. Also, they have a deeper understanding of the overall industry.
Brokers research on a company’s publicly available financial statements, listen to conference calls and engage in talks directly with top management. At times, they even talk with customers to gauge what they like or dislike about the products and services offered by the company.
Therefore, after thorough research, brokers decide to rate that particular company’s stock. Naturally, when an analyst upgrades a stock, one can easily depend on it.
But solely depending on analysts’ upgrades is not the right way to build investment portfolio. One should also take into consideration other factors to ensure solid returns.
Choosing the Winning Strategy
We have a screening strategy that will help in your search for potential winners:
Broker Rating Upgrades (4 weeks) of 1% or more: The screen selects stocks that have witnessed broker rating upgrades of 1% or more over the last four weeks.
Current Price greater than 5: The stocks must be trading above $5.
Average 20-day Volume greater than 100,000: A large trading volume guarantees that the stock is easily tradable.
Zacks Rank equal to #1 or #2: No matter whether market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) or #2 (Buy) have a proven record of success. You can see the complete list of today’s Zacks #1 Rank stocks here.
VGM Score equal to A or B: Our research shows that stocks with a VGM Score of A or B when combined with a Zacks Rank #1 or 2 offer the best upside potential.
Here are three stocks that made it through the screen:
Air Lease Corporation (AL - Free Report) , headquartered in Los Angeles, CA, is an aircraft leasing company engaged in the purchase and leasing of commercial jet transport aircraft to airlines. Its 2018 earnings are expected to increase 26.9%. The stock, sporting a Zacks Rank #1, has witnessed 10% upward revision in broker ratings over the past four weeks.
Based in Rolling Meadows, IL-Arthur J. Gallagher & Co. (AJG - Free Report) provides insurance brokerage, consulting, and third party claims settlement and administration services. This Zacks Rank #2 company’s earnings are expected to increase 17% for the current year. The stock has witnessed 9.1% upward revision in broker ratings over the past four weeks.
Menomonee Falls, WI-based Kohl's Corporation (KSS - Free Report) operates department stores. The company’s earnings are expected to surge 23.6% in 2018. The stock, sporting a Zacks Rank #1, has witnessed 5.9% upward revision in broker ratings over the past four weeks.
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
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