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Momentum Alert: 3 Top Ranked Stocks Crushing the Market this Year
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If you have been a reader of my past articles, you will know that I am very favorable to the momentum anomaly. There are few trading edges as well researched and proven as momentum, which I why I focus on it so regularly.
Another of my favorite market advantages is the Zacks Rank, which is phenomenal at identifying winning stocks, by aggregating analysts’ earnings revision trends.
By combining these two factors, investors can regularly research and trade some of the best performing stocks in the market.
Zacks Stock Screener finds Top Performing Companies
Last night, I used the Zacks screener to filter for winning stocks. I searched for stocks that have a relative price performance better than the market YTD, a market cap greater than $5 billion, EPS growth greater than 15% annually over the last five years, and a Zacks Rank better than #3.
Image Source: Zacks Investment Research
From there I organized the stocks by relative outperformance against the S&P 500, and picked three that also enjoy reasonable valuations, below their historical medians.
By doing this I have identified stocks that have a number of bullish catalysts, including rising earnings revisions and growth, strong momentum propelling them higher and limited downside risk thanks to the fair valuations.
Lundin Mining (LUNMF - Free Report) , Interactive Brokers (IBKR - Free Report) and Crocs (CROX - Free Report) all stood out to me as some of the most compelling stocks from my screen and are some of the best in the market today.
Image Source: TradingView
Lundin Mining: Riding the Rally in Commodities
Lundin Mining is a Canadian-based multinational mining company headquartered in Toronto, Ontario. Founded in 1994, Lundin specializes in the extraction of base metals, including copper, zinc, and nickel, with operations and projects in North America, South America, Europe, and Africa. The company's key assets include the Candelaria copper-gold mine in Chile, the Eagle nickel-copper mine in the United States, and the Neves-Corvo copper-zinc mine in Portugal.
At Lundin Mining, the recent year has been one marked by record copper production, which is expected to continue to grow by 15% this year. The strong performance in 2023 lead to $345 million in free cash flow and allowed management to return $206 million to shareholders in dividends. Lundin Mining has a dividend yield of 2.3%.
Additionally, because of the recent rise in the price of copper, earnings are expected to climb even further. Analysts have raised earnings estimates giving Lundin Mining a Zacks Rank #2 (Buy) rating.
FY24 EPS are projected to jump 82% YoY and FY25 are expected to climb another 30%.
Image Source: Trading Economics
Also notable is Lundin Mining’s current valuation. Today LUNMF is trading at a one year forward earnings multiple of 14.4x, which is just below its 10-year median of 15x and well below the industry average of 29.3x.
Interactive Brokers: Leading Trading Venue
Interactive Brokers is a globally recognized brokerage firm headquartered in Greenwich, Connecticut. It has become a leading provider of trading and investment services, catering to individual investors, institutional clients, and financial professionals.
Interactive Brokers offers a comprehensive trading platform with access to a wide range of financial instruments, including stocks, options, futures, forex, bonds, and mutual funds. The firm is known for its advanced technology, competitive pricing, extensive market access, and robust risk management tools. Interactive Brokers emphasizes transparency and low costs, making it a preferred choice for active traders and investors seeking sophisticated trading solutions.
Earnings estimates for Interactive Brokers have been on the rise since Q4 of 2023, and have continued until today, giving it a Zacks Rank #2 (Buy) rating.
FY24 earnings estimates are up 7% in the last two months and FY25 are up 7.3% over the same period. Additionally, sales are expected to climb 10% YoY while EPS are projected to increase by 13%.
IBKR is trading at a one year forward earnings multiple of 19.4x, which is below its 10-year median of 22.4x.
As of May 2024, Interactive Brokers has 2.4 million Daily Active Revenue Traders – 33% higher than last year. Client equity held at the firm is $457 billion – 34% higher than the prior year. And net interest income of $747 million last quarter was a 17% YoY increase.
Image Source: Zacks Investment Research
Crocs: An Apparel Phenomenon
Crocs is an American footwear company known for its distinctive and comfortable clogs. Founded in 2002 and headquartered in Broomfield, Colorado, Crocs originally introduced their foam resin shoes, made from a proprietary material called Croslite, which provides lightweight comfort and durability.
Over the years, the brand has expanded its product line to include a variety of shoe styles, such as sandals, flip-flops, and boots, while maintaining a focus on comfort and functionality. Crocs' unique designs and vibrant colors have garnered a loyal customer base and a strong presence in the casual footwear market.
Following the Covid pandemic, sales at Crocs grew massively, from $1.4 billion annually in 2020 to $4 billion today. Profits climbed exponentially as well, jumping from $3.13 per share to $12.44 today.
And analysts continue to raise earnings estimates for the shoe brand, as CROX still boasts a Zacks Rank #2 (Buy) rating.
Image Source: Zacks Investment Research
Even more impressive than its climb in profits, is that the company is still trading at a fair valuation. Today, CROX is trading at a one year forward earnings multiple of 12.3x, well below its 10-year median of 22.4x, and below the industry average of 15.6x.
Additionally, although the company does not pay a dividend, they are still committed to returning cash to shareholders. Over the last ten years management has steadily been buying back shares, reducing the shares outstanding by 30%.
Momentum, Earnings Growth and Fair Valuations
There are many ways to go about picking winning stocks, but I like to stack as many advantages as possible. With Crocs, Interactive Brokers, and Lundin Mining we have strong growth, reasonable valuations, top Zacks ranks and market beating momentum.
For investors seeking new additions to their portfolios, these stocks are worthwhile considerations.
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Momentum Alert: 3 Top Ranked Stocks Crushing the Market this Year
If you have been a reader of my past articles, you will know that I am very favorable to the momentum anomaly. There are few trading edges as well researched and proven as momentum, which I why I focus on it so regularly.
Another of my favorite market advantages is the Zacks Rank, which is phenomenal at identifying winning stocks, by aggregating analysts’ earnings revision trends.
By combining these two factors, investors can regularly research and trade some of the best performing stocks in the market.
Zacks Stock Screener finds Top Performing Companies
Last night, I used the Zacks screener to filter for winning stocks. I searched for stocks that have a relative price performance better than the market YTD, a market cap greater than $5 billion, EPS growth greater than 15% annually over the last five years, and a Zacks Rank better than #3.
Image Source: Zacks Investment Research
From there I organized the stocks by relative outperformance against the S&P 500, and picked three that also enjoy reasonable valuations, below their historical medians.
By doing this I have identified stocks that have a number of bullish catalysts, including rising earnings revisions and growth, strong momentum propelling them higher and limited downside risk thanks to the fair valuations.
Lundin Mining (LUNMF - Free Report) , Interactive Brokers (IBKR - Free Report) and Crocs (CROX - Free Report) all stood out to me as some of the most compelling stocks from my screen and are some of the best in the market today.
Image Source: TradingView
Lundin Mining: Riding the Rally in Commodities
Lundin Mining is a Canadian-based multinational mining company headquartered in Toronto, Ontario. Founded in 1994, Lundin specializes in the extraction of base metals, including copper, zinc, and nickel, with operations and projects in North America, South America, Europe, and Africa. The company's key assets include the Candelaria copper-gold mine in Chile, the Eagle nickel-copper mine in the United States, and the Neves-Corvo copper-zinc mine in Portugal.
At Lundin Mining, the recent year has been one marked by record copper production, which is expected to continue to grow by 15% this year. The strong performance in 2023 lead to $345 million in free cash flow and allowed management to return $206 million to shareholders in dividends. Lundin Mining has a dividend yield of 2.3%.
Additionally, because of the recent rise in the price of copper, earnings are expected to climb even further. Analysts have raised earnings estimates giving Lundin Mining a Zacks Rank #2 (Buy) rating.
FY24 EPS are projected to jump 82% YoY and FY25 are expected to climb another 30%.
Image Source: Trading Economics
Also notable is Lundin Mining’s current valuation. Today LUNMF is trading at a one year forward earnings multiple of 14.4x, which is just below its 10-year median of 15x and well below the industry average of 29.3x.
Interactive Brokers: Leading Trading Venue
Interactive Brokers is a globally recognized brokerage firm headquartered in Greenwich, Connecticut. It has become a leading provider of trading and investment services, catering to individual investors, institutional clients, and financial professionals.
Interactive Brokers offers a comprehensive trading platform with access to a wide range of financial instruments, including stocks, options, futures, forex, bonds, and mutual funds. The firm is known for its advanced technology, competitive pricing, extensive market access, and robust risk management tools. Interactive Brokers emphasizes transparency and low costs, making it a preferred choice for active traders and investors seeking sophisticated trading solutions.
Earnings estimates for Interactive Brokers have been on the rise since Q4 of 2023, and have continued until today, giving it a Zacks Rank #2 (Buy) rating.
FY24 earnings estimates are up 7% in the last two months and FY25 are up 7.3% over the same period. Additionally, sales are expected to climb 10% YoY while EPS are projected to increase by 13%.
IBKR is trading at a one year forward earnings multiple of 19.4x, which is below its 10-year median of 22.4x.
As of May 2024, Interactive Brokers has 2.4 million Daily Active Revenue Traders – 33% higher than last year. Client equity held at the firm is $457 billion – 34% higher than the prior year. And net interest income of $747 million last quarter was a 17% YoY increase.
Image Source: Zacks Investment Research
Crocs: An Apparel Phenomenon
Crocs is an American footwear company known for its distinctive and comfortable clogs. Founded in 2002 and headquartered in Broomfield, Colorado, Crocs originally introduced their foam resin shoes, made from a proprietary material called Croslite, which provides lightweight comfort and durability.
Over the years, the brand has expanded its product line to include a variety of shoe styles, such as sandals, flip-flops, and boots, while maintaining a focus on comfort and functionality. Crocs' unique designs and vibrant colors have garnered a loyal customer base and a strong presence in the casual footwear market.
Following the Covid pandemic, sales at Crocs grew massively, from $1.4 billion annually in 2020 to $4 billion today. Profits climbed exponentially as well, jumping from $3.13 per share to $12.44 today.
And analysts continue to raise earnings estimates for the shoe brand, as CROX still boasts a Zacks Rank #2 (Buy) rating.
Image Source: Zacks Investment Research
Even more impressive than its climb in profits, is that the company is still trading at a fair valuation. Today, CROX is trading at a one year forward earnings multiple of 12.3x, well below its 10-year median of 22.4x, and below the industry average of 15.6x.
Additionally, although the company does not pay a dividend, they are still committed to returning cash to shareholders. Over the last ten years management has steadily been buying back shares, reducing the shares outstanding by 30%.
Momentum, Earnings Growth and Fair Valuations
There are many ways to go about picking winning stocks, but I like to stack as many advantages as possible. With Crocs, Interactive Brokers, and Lundin Mining we have strong growth, reasonable valuations, top Zacks ranks and market beating momentum.
For investors seeking new additions to their portfolios, these stocks are worthwhile considerations.