For Immediate Release
Chicago, IL – June 4, 2018 - Stocks in this week’s article include: Bunge Limited (BG - Free Report) , Delek US Holdings, Inc. (DK - Free Report) , Big 5 Sporting Goods Corporation (BGFV - Free Report) AMC Entertainment Holdings, Inc. (AMC - Free Report) and Century Communities Inc. (CCS - Free Report) .
Screen of the Week of Zacks Investment Research:
5 Broker-Friendly Stocks to Brave Ongoing Geopolitical Woes
Over the past few weeks, U.S. tensions with China, Iran and the uncertainty regarding diplomatic ties with North Korea have dragged the broader equity market down on multiple occasions.
As if the above woes were not enough, the political crisis in Italy also created ripples across the global equity markets a couple of days ago. Investors fear that such a constitutional crisis in one of Europe’s largest economies will wreak havoc worldwide. Markets are also rattled by the political turmoil in Spain
Time for Some Expert Advice?
Given the string of unfavorable political events worldwide, investors are striving to design a winning portfolio of stocks. They, after all, are putting their hard-earned money into stocks and consequently their sole objective is to generate handsome returns irrespective of the market conditions.
One of the tried and tested strategies is to maintain a well-diversified portfolio (i.e. including stocks from different industries) so that one rakes in solid returns at all times. However, it is easier said than done.
With multiple stocks flooding the market at any point of time, it is next to impossible to design one’s portfolio with appropriate stocks in the absence of guidance from people equipped with proper knowhow about the market.
Additionally, with time at a premium these days, it is next to impossible for investors to go through the extensive process. Given this backdrop, it is in the best interest of investors to seek guidance from “experts in the field."
Who are the Experts & Why?
The “experts” in the field of investing are brokers who are equipped with thorough knowledge about the space. Brokers, irrespective of their types (sell-side, buy-side or independent), have at their disposal a lot more information on a company and its prospects than individual investors.
To attain their objective, they go through minute details of the publicly available financial documents apart from attending company conference calls and other presentations. Broker opinion should thus act as a valuable guide for investors while deciding their course of action (buy, sell or hold) on a particular stock.
Direction of Earnings Estimates: A Winning Pointer
Since brokers meticulously follow the stocks in their coverage, they revise their earnings estimates after carefully examining the pros and cons of an event for the concerned company. The estimate revisions serve as an important pointer regarding the price of a stock.
For example, an earnings outperformance by a company generally leads to upward estimate revisions with prices moving north. Similarly, lackluster earnings often lead to stock price depreciation. Investors tend to be guided by the direction of estimate revisions and stock price while formulating their investment strategy.
To take care of the earnings performance, we have designed a screen based on improving analyst recommendation and upward estimate revisions over the last four weeks.
Consider the Top Line Too
However, designing a strategy based solely on the bottom line is unlikely to result in a winning strategy. Actually, according to many market watchers a revenue beat is more creditable for a company than a mere earnings outperformance, especially in an environment of revenue weakness due to macroeconomic headwinds like a strong dollar or lackluster demand for travel (which will hurt travel-focused companies). To address top-line concerns, we have included in our screen the price/sales ratio, which serves as a strong complementary valuation metric.
And that's what we're screening for today…
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/306023/5-brokerfriendly-stocks-to-brave-ongoing-geopolitical-woes
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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
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Contact: Jim Giaquinto
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