For Immediate Release
Chicago, IL – May 30, 2018 - Stocks in this week’s article Pilgrim's Pride Corp. (PPC - Free Report) , NutriSystem Inc (NTRI - Free Report) , Wabco Holdings Inc. (WBC - Free Report) , Matthews International Corp. (MATW - Free Report) and Meritor Inc. (MTOR - Free Report) .
Add 5 Stocks with Rising P/Es to Your Portfolio
Investors love stocks with a low price-to-earnings (P/E) ratio. The perception is that the lower the P/E, the higher will be the value of the stock. The simple logic that a stock’s current market price does not justify (is not equivalent to) its higher earnings and therefore has room to run is behind investors’ inclination toward low P/E stocks.
But stocks with a rising P/E can also be worth buying. We’ll tell you why.
Why Rising P/E a Valuable Tool?
Investors should note that stock price moves in tandem with earnings performance. If earnings come in stronger, the price of a stock shoots up. Solid quarterly earnings and the forward guidance boost earnings forecasts, leading to stronger demand for the stock and an uptrend in its price.
So, if the price is rising steadily, it means that investors are assured of the stock’s fundamental strength and expect some strong positives out of it. Also, studies have revealed that stocks have seen their P/E ratios jump over 100% from their breakout point in the cycle. So, if you can pick stocks early in their breakout cycle, you can end up seeing considerable gains.
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/305351/add-5-stocks-with-rising-pe-to-your-portfolio
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Strong Stocks that Should Be in the News
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