Back to top

Image: Bigstock

Zacks.com featured highlights include: ArcBest, American Airlines, AmerisourceBergen, Owens & Minor and Commercial Metals

Read MoreHide Full Article

For Immediate Release

Chicago, IL – January 24, 2019 - Stocks in this week’s article are ArcBest Corporation (ARCB - Free Report) , American Airlines (AAL - Free Report) , AmerisourceBergen , Owens & Minor (OMI - Free Report) and Commercial Metals Company (CMC - Free Report) .

5 Stocks that Look Impressive After Broker Rating Upgrades

The Q4 earnings season is in its nascent stage with 44 S&P 500 participants having reported results according to our latest earnings outlook. The season had a bright start courtesy of earnings beats from big players like JPMorgan Chase & Co. and Delta Air Lines.

Investors will be hoping that the momentum continues throughout the earnings season and a high proportion of companies report better-than-expected numbers. This is because, generally, an earnings beat by a company leads to an uptick in its stock price. Given this backdrop, investors will like to add outperformers to their respective portfolios for healthy returns.

Nonetheless, the task is far from easy with a plethora of companies present in the market. Apart from this, the complexities related to the stock market make it even more difficult for individual investors to select outperformers in their portfolios without proper guidance.

Broker Advice to the Rescue

The requisite guidance to design a winning portfolio comes from brokers. Brokers have a better understanding of stocks, deeper knowledge of the industry and grasp over the broader economy. They scrutinize a company’s fundamentals and place those against the prevalent economic scenario to find out how attractive or otherwise a stock is as an investment option.

Since brokers arrive at their recommendations (buy, sell or hold) for a stock after thoroughly analyzing the nitty-gritties associated with the company, it is advisable for investors to follow the estimate revision directions while deciding their course of action on a particular stock. The estimate revisions serve as an important pointer regarding the price of a stock. Estimates can move north for a number of reasons — favorable earnings performance, a bullish guidance, product launch or any favorable macro scenario. 

One of the well-accepted investment strategies is to maintain a diversified portfolio to generate handsome returns irrespective of market conditions. For instance, in the face of extremely low oil prices, analysts adopt a bullish stance on airline stocks and consequently raise estimates. Naturally, adding such stocks to one’s portfolio in such a scenario might prove to be a bullish strategy.

Formulating a Winning Portfolio

We have designed a screener to arrive at stocks based on improving analyst recommendations and upward earnings estimate revisions over the last four weeks. However, considering only these factors does not make our strategy foolproof as the top line has not been considered.

Actually, according to many market watchers, a top-line outperformance is more creditable for a company than a mere earnings outperformance. To address top-line concerns, we have included the price/sales ratio in our screener, which serves as a strong complementary valuation metric.

For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/730194/5-stocks-that-look-impressive-after-broker-rating-upgrades

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

Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine.  But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.

Strong Stocks that Should Be in the News

Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.

Follow us on Twitter:  http://twitter.com/zacksresearch

Join us on Facebook:  http://www.facebook.com/ZacksInvestmentResearch

Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.

Contact: Jim Giaquinto

Company: Zacks.com

Phone: 312-265-9268

Email: pr@zacks.com

Visit: www.Zacks.com

Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Published in