A number of fundamental and technical aspects are involved in identifying stocks with robust growth potential. It is daunting for individual investors to select stocks on their own. Hence, guidance from the experts is important.
By following broker ratings, an investor can easily find promising stocks. Brokers have in-depth idea about what’s happening in a particular company, as they directly communicate with top management. Also, they exhaustively go through the company’s publicly available documents and attend conference calls.
In addition, brokers have a thorough understanding of the overall industry. They place the company fundamentals against the current economic backdrop to figure out how the stock will fare as an investment.
Therefore, when a broker upgrades a stock, you can rely on their judgment. However, depending only on broker upgrades is not a great idea to build your investment portfolio. You should also take into account some other factors to ensure steady returns.
Choosing the Winning Strategy
We have a screening strategy that will help in your search for potential winners:
Broker Rating Upgrades (four 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 of 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 qualified the screening:
Sanofi (SNY - Free Report) , based in Paris, France, provides therapeutic solutions. Its earnings are expected to grow1.2% in 2019. The stock, carrying a Zacks Rank #2, has witnessed 12.5% upward revision in broker ratings over the past four weeks.
Based in Los Angeles, CA, KB Home (KBH - Free Report) operates as a homebuilding company. Its 2019 earnings are expected to increase 56.7%. The stock, carrying a Zacks Rank #2, has witnessed 7.1% upward revision in broker ratings over the past four weeks.
NRG Energy, Inc. (NRG - Free Report) , headquartered in Princeton, NJ, operates as an energy company. Its earnings are expected to surge 61.4% in 2019. The stock, sporting a Zacks Rank #1, has witnessed 25% 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.
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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.
Disclosure: Performance information for Zacks’ portfolios and strategies are available at: https://www.zacks.com/performance