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5 Stocks With Rising Cash Flows to Battle Coronavirus Crisis
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Cash is the lifeblood of any business, and provides vitality and strength to a company. It holds the key to a company’s existence, development and success, and indicates its true financial health.
Moreover, with the coronavirus pandemic wreaking havoc on the global economy, and the resultant market disruption and dislocations being unprecedented with significant impact on liquidity, laying a wager on stocks based on their cash-flow generating efficiency looks all the more prudent.
This is because even a profitable business can succumb to failure if its cash flow is uneven and eventually, file for bankruptcy. However, one can efficiently sail through any market mayhem if it has the cash to shield it. In fact, a healthy cash position indicates that profits are being efficiently channelized to the company’s reserves, helping it enjoy the flexibility to make decisions, chase potential investments and run its growth engine.
To figure out this efficiency, one needs to consider a company’s net cash flow. While in any business cash moves in and out, it is net cash flow that explains how much money a company is actually generating.
If a company is experiencing a positive cash flow then it denotes an increase in its liquid assets, which gives it the means to meet debt obligations, shell out for expenses, reinvest in business, endure downturns and finally return wealth to shareholders. On the other hand, a negative cash flow indicates a decline in the company’s liquidity, which in turn lowers its flexibility to support these moves.
However, having a positive cash flow merely does not secure a company’s future growth. To ride on the growth curve, a company must have its cash flow increasing because that indicates management’s efficiency in regulating its cash movements and less dependency on outside financing for running its business.
Therefore, keep yourself abreast with the following screen to bet on stocks with rising cash flows.
Screening Parameters:
To find stocks that have seen increasing cash flow over time, we ran the screen for those whose cash flow in the latest reported quarter was at least equal to or greater than the 5-year average cash flow per common share. This implies a positive trend and increasing cash over a period of time.
In addition to this we chose:
Zacks Rank 1: No matter whether market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) have a proven history of outperformance. You can see the complete list of today’s Zacks #1 Rank stocks here.
Average Broker Rating 1: This indicates that brokers are also highly hopeful about the company’s future performance.
Current Price greater than or equal to $5: This sieves out low-priced stocks.
VGM Score of B or better: This score is also of great assistance in selecting stocks. Importantly, this scoring system helps in picking winning stocks in their individual industry categories.
Here are five of the 11 stocks that qualified the screening:
Headquartered in New York, NY, PJT Partners Inc. (PJT - Free Report) is a global advisory-focused investment bank. The stock has a VGM Score of A. Moreover, the Zacks Consensus Estimate for 2020 earnings per share moved up 3.8% to $3.04 over the past 30 days.
CBIZ, Inc. (CBZ - Free Report) provides professional business services that help clients better manage their finances and employees. At present, this stock has a VGM Score of B. The Zacks Consensus Estimate of $1.40 for current-year earnings suggests a 10.2% year-over-year increase.
BioSpecifics Technologies Corporation is engaged in the business of producing and licensing, for sale by other, a U.S. Food and Drug Administration (FDA)-approved enzyme derived from collagenase, named Collagenase ABC, and researching, developing and clinically testing additional products derived therefrom for potential use as pharmaceuticals. The stock has a VGM Score of B. The Zacks Consensus Estimate of $3.79 for this year’s earnings moved upward by four cents over the past 60 days.
eXp World Holdings Inc. (EXPI - Free Report) provides cloud-based real estate brokerage services primarily in the United States and Canada. The stock has a VGM Score of B. The Zacks Consensus Estimate for the ongoing-year earnings per share has been revised upward over the last 60 days. Also, the estimate for current-year sales indicates a 46.2% jump, year on year.
Gibraltar Industries Inc. (ROCK - Free Report) manufactures and distributes products to the industrial and buildings market. It has a VGM Score of B. It has witnessed a positive earnings estimate revision of nearly 6% for this year to $3.01 in the past two months.
Get the rest of the stocks on the list and start putting this and other ideas to the test. It can all be done with the Research Wizard stock picking and back-testing software.
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.
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.
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5 Stocks With Rising Cash Flows to Battle Coronavirus Crisis
Cash is the lifeblood of any business, and provides vitality and strength to a company. It holds the key to a company’s existence, development and success, and indicates its true financial health.
Moreover, with the coronavirus pandemic wreaking havoc on the global economy, and the resultant market disruption and dislocations being unprecedented with significant impact on liquidity, laying a wager on stocks based on their cash-flow generating efficiency looks all the more prudent.
This is because even a profitable business can succumb to failure if its cash flow is uneven and eventually, file for bankruptcy. However, one can efficiently sail through any market mayhem if it has the cash to shield it. In fact, a healthy cash position indicates that profits are being efficiently channelized to the company’s reserves, helping it enjoy the flexibility to make decisions, chase potential investments and run its growth engine.
To figure out this efficiency, one needs to consider a company’s net cash flow. While in any business cash moves in and out, it is net cash flow that explains how much money a company is actually generating.
If a company is experiencing a positive cash flow then it denotes an increase in its liquid assets, which gives it the means to meet debt obligations, shell out for expenses, reinvest in business, endure downturns and finally return wealth to shareholders. On the other hand, a negative cash flow indicates a decline in the company’s liquidity, which in turn lowers its flexibility to support these moves.
However, having a positive cash flow merely does not secure a company’s future growth. To ride on the growth curve, a company must have its cash flow increasing because that indicates management’s efficiency in regulating its cash movements and less dependency on outside financing for running its business.
Therefore, keep yourself abreast with the following screen to bet on stocks with rising cash flows.
Screening Parameters:
To find stocks that have seen increasing cash flow over time, we ran the screen for those whose cash flow in the latest reported quarter was at least equal to or greater than the 5-year average cash flow per common share. This implies a positive trend and increasing cash over a period of time.
In addition to this we chose:
Zacks Rank 1: No matter whether market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) have a proven history of outperformance. You can see the complete list of today’s Zacks #1 Rank stocks here.
Average Broker Rating 1: This indicates that brokers are also highly hopeful about the company’s future performance.
Current Price greater than or equal to $5: This sieves out low-priced stocks.
VGM Score of B or better: This score is also of great assistance in selecting stocks. Importantly, this scoring system helps in picking winning stocks in their individual industry categories.
Here are five of the 11 stocks that qualified the screening:
Headquartered in New York, NY, PJT Partners Inc. (PJT - Free Report) is a global advisory-focused investment bank. The stock has a VGM Score of A. Moreover, the Zacks Consensus Estimate for 2020 earnings per share moved up 3.8% to $3.04 over the past 30 days.
CBIZ, Inc. (CBZ - Free Report) provides professional business services that help clients better manage their finances and employees. At present, this stock has a VGM Score of B. The Zacks Consensus Estimate of $1.40 for current-year earnings suggests a 10.2% year-over-year increase.
BioSpecifics Technologies Corporation is engaged in the business of producing and licensing, for sale by other, a U.S. Food and Drug Administration (FDA)-approved enzyme derived from collagenase, named Collagenase ABC, and researching, developing and clinically testing additional products derived therefrom for potential use as pharmaceuticals. The stock has a VGM Score of B. The Zacks Consensus Estimate of $3.79 for this year’s earnings moved upward by four cents over the past 60 days.
eXp World Holdings Inc. (EXPI - Free Report) provides cloud-based real estate brokerage services primarily in the United States and Canada. The stock has a VGM Score of B. The Zacks Consensus Estimate for the ongoing-year earnings per share has been revised upward over the last 60 days. Also, the estimate for current-year sales indicates a 46.2% jump, year on year.
Gibraltar Industries Inc. (ROCK - Free Report) manufactures and distributes products to the industrial and buildings market. It has a VGM Score of B. It has witnessed a positive earnings estimate revision of nearly 6% for this year to $3.01 in the past two months.
Get the rest of the stocks on the list and start putting this and other ideas to the test. It can all be done with the Research Wizard stock picking and back-testing software.
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.