Stocks dropped Tuesday, driven lower by technology. The fall came after Fed governor Lael Brainard indicated that the central bank could ramp up its efforts to tamp down 40-year higher inflation. Outside of the Fed’s increasingly hawkish tones, the Russian invasion of Ukraine shows no signs of slowing down.

Tuesday’s headlines don’t really change much since investors knew the easy money days were over and the Fed would likely be forced to take significant action to fend off 8% inflation. What’s next on the geopolitical front has remained murky for some time now.

These headwinds are real, but the pullback Tuesday also feels like a chance for Wall Street to take some money off the table following a huge run in the final few weeks of March that saw the Nasdaq surge 16% from March 14 until Monday’s close.

The Nasdaq dropped around 2% through late afternoon trading Tuesday as it continues to face resistance at its 200-day moving average. The S&P 500 remains above that same closely-watched level after Tuesday’s roughly 1% pullback.

The selling and volatility seem poised to remain until the market gets more clarity on inflation and the Fed’s next moves. That doesn’t mean investors should stay on the sidelines because timing the market is no easy task.

Instead, investors who can stomach the current uncertainty and take a longer-term approach might want to consider buying highly-ranked stocks to start the second quarter. Today, we utilized a Zacks screen to help find ‘Strong Buy’ stocks trading near their highs amid the wild start to 2022.

Don't Be Afraid of New Highs

Some investors might prefer not to buy stocks at new highs. But if somebody asked you what the best stocks in your portfolio are, it’s likely you would name the stocks moving up the most.

The most basic idea is that the winners in your portfolio are the ones going up. If a stock is underperforming the market or going down, you'll quickly identify it as one of your worst holdings. Therefore, it makes sense that some of these stocks will be reaching new highs along the way.

Many investors are hesitant to buy stocks making new 52-week highs. But there really isn’t any reason to be. Some may worry that they have already missed the mark at that point, or that now it has more room to fall. Still, a stock making a new 52-week high is a ‘good thing,’ just as one falling to a new 52-week low is a ‘bad thing.’

On top of that, would the person who doesn’t want to buy stocks making new highs be upset if a stock they owned broke out to a new 52-week high? Statistics have also shown that stocks making new highs have a tendency of making even higher highs. And aren’t these the stocks we all dream about?

Now obviously, the fundamentals need to be there, and you should try to keep an eye on valuations. But if you were in a stock making new highs and cheering it on, it seems odd to be afraid of one doing the same just because you haven't bought it yet.

Think about this: A stock just made a new-52 week high, which is great news. Guess what? Last year it made a new 52-week high as well. And the year before that. And the year before that. Can you imagine all the money you'd be leaving on the table if you were afraid of being in stocks every time they made a new high?

Parameters

• Current Price/52-Week High greater than or equal to .80

• Percent Change in Price over 12 Weeks greater than 0

• Percent Change in Price over 4 Weeks greater than 0

• Zacks Rank equal to 1

• Price/Sales Ratio less than or equal to Industry Median

• P/E (using F1 Estimates) less than or equal to Industry Median

• Projected One Year EPS Growth F(1)/F(0) greater than or equal to Industry Median

• Current Avg. 20-Day Volume greater than Previous Week's Avg. 20-Day Volume

• All of the above parameters are applied to stocks with a Price greater than or equal to $5 and an Average 20-Day Volume of greater than or equal to 100,000 shares.

• Percent Change in Price over 12 Weeks + Percent Change in Price over 4 Weeks equal to Top # 5

Here are two of the five stocks that made it through today’s screen…

Alpha Metallurgical Resources (AMR Quick QuoteAMR - Free Report)

Alpha Metallurgical Resources is a Tennessee-based mining company with operations across Virginia and West Virginia. AMR supplies metallurgical products to the steel industry. The firm boasts a global customer base, alongside high-quality reserves and significant port capacity. AMR posted a blowout year in 2021, with revenue up 60% to help it swing from an adjusted loss in 2020 to +$15.30 per share.

Alpha Metallurgical Resources executives said it was able to make big steps to solidify its role as a “leading pure-play metallurgical coal company and building on our role as the largest U.S. met coal producer.” The firm also used the past year to improve its balance sheet, and it announced a $150 million repurchase program in early March. AMR’s outlook for 2022 is strong and Alpha Metallurgical Resources shares have soared over 90% in 2022.

Univar Solutions

Univar Solutions is a leading global commodity and specialty chemical and ingredient distributor. Univar’s revenue climbed 15% in 2021, with its adjusted earnings up 68%. UNVR executives provided strong guidance for 2022 at the end of February, with its FY22 consensus EPS estimate up 34% and its FY23 figure 10% higher. 

Zacks estimates call for Univar’s adjusted 2022 earnings to climb another 19% on 6% stronger sales. UNVR stock is up 40% in the last three years to outpace its industry’s 3% climb. This run includes a 40% surge in the last 12 months and a 12% jump in 2022, as Wall Street turns to energy and commodities stocks. And all five of the brokerage recommendations Zacks has for UNVR are “Strong Buys.”

Get the rest of the stocks on this list and start looking for the newest companies that fit these criteria. It's easy to do. And it could help you find your next big winner. Start screening for these companies today with a free trial to the Research Wizard. You can do it.

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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/.