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5 Top-Ranked Relative Price Strength Stocks for Your Basket
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U.S. stock markets witnessed an astonishing rally in the past 15 months. Following a strong 2023, Wall Street has continued its impressive run this year, too, with the S&P 500 surging 10.2% during this period. Notably, the last quarter was its strongest first-quarter showing since 2019. We anticipate the bullish momentum to prevail, bolstered by a robust U.S. economy.
However, the U.S. inflation rate remains stubborn despite a restrictive monetary policy and an extremely high interest rate regime in the last 24 months. Fed officials are concerned that even after declining to a great extent from its peak in June 2022, the inflation rate is yet to show any convincing evidence that it is moving gradually to the targeted level of 2%.
Given these wide-ranging factors, investors are turning their attention to stocks with a strong relative price performance. This allows them to seize promising opportunities that offer the potential for high returns.
Relative Price Strength Strategy
Earnings growth and valuation multiples are indeed important for investors to determine a stock's ability to offer considerable returns. But these are also essential for determining whether a stock’s price performance is better than its peers or the industry average.
If a stock’s performance is lacking that of the broader groups, despite impressive earnings growth or valuation multiples, then something must be wrong.
It’s always advisable to stay away from these stocks and bet on those that are outperforming their respective industry or benchmark. This is because betting on a winner always proves to be lucrative.
Then again, it is imperative that you determine whether or not an investment has relevant upside potential when considering stocks with significant relative price strength. Stocks delivering better than the S&P 500 for 1 to 3 months at least and having solid fundamentals indicate room for growth and are the best ways to go about this strategy.
Finally, it is crucial to find out whether analysts are optimistic about the upcoming earnings of these companies. In order to do this, we have added positive estimate revisions for the current quarter’s (Q1) earnings to our screen. When a stock undergoes an upward revision, it leads to additional price gains.
Screening Parameters
Relative % Price change – 12 weeks greater than 0
Relative % Price change – 4 weeks greater than 0
Relative % Price change – 1 week greater than 0
(We have considered those stocks that have been outperforming the S&P 500 over the last 12 weeks, four weeks and one week.)
% Change (Q1) Est. over 4 Weeks greater than 0: Positive current-quarter estimate revisions over the last four weeks.
Zacks Rank equal to 1: Only Zacks Rank #1 (Strong Buy) stocks — that have returned more than 26% annually over the last 26 years and surpassed the S&P 500 in 23 of the last 26 years — can get through. You can see the complete list of today’s Zacks #1 Rank stocks here.
Current Price greater than or equal to $5 and Average 20-day Volume greater than or equal to 50,000: A minimum price of $5 is a good standard to screen low-priced stocks, while a high trading volume would imply adequate liquidity.
VGM Score less than or equal to B: Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best upside potential.
Here are the five stocks that made it through the screen:
GigaCloud Technology Inc. (GCT - Free Report) : Based in El Monte, CA, the company is a B2B e-commerce and logistics solutions provider. GCT has a trailing four-quarter earnings surprise of roughly 42.3%, on average. The company has a VGM Score of B.
Notably, the Zacks Consensus Estimate for GigaCloud Technology’s 2024 earnings per share indicates 12.2% year-over-year growth. The company has a market capitalization of $1.4 billion. GCT shares have gone up 594.5% in a year.
Murphy USA Inc. (MUSA - Free Report) : The company is a leading independent retailer of motor fuel and convenience merchandise in the United States. The Zacks Consensus Estimate for 2024 earnings of this firm indicates 3.6% growth. Headquartered in El Dorado, AR, MUSA has a VGM Score of A.
Over the past 60 days, the Zacks Consensus Estimate for 2024 has moved up 4.1%. Murphy USA has a trailing four-quarter earnings surprise of roughly 13.6%, on average. MUSA shares have increased 51.5% in a year.
HCI Group, Inc. (HCI - Free Report) : The company specializes in offering residential insurance solutions, including homeowners, fire, flood, and wind-only insurance, catering to a diverse range of clients. Over the past 60 days, this Tampa, FL-based firm saw the Zacks Consensus Estimate for 2024 move up 38.8%. HCI has a VGM Score of A.
The Zacks Consensus Estimate for 2024 earnings of HCI Group Group indicates 39.4% growth. The company beat the Zacks Consensus Estimate for earnings in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 522.5%, on average. HCI shares have gained 101.3% in a year.
Kaiser Aluminum Corporation (KALU - Free Report) : The company produces semi-fabricated specialty aluminum products used in a wide range of industries. The Zacks Consensus Estimate for 2024 earnings of this firm indicates 33.2% growth. Headquartered in Franklin, TN, KALU has a VGM Score of A.
Over the past 60 days, the Zacks Consensus Estimate for 2024 has moved up 22.9%. Kaiser Aluminum has a trailing four-quarter earnings surprise of roughly 157.2%, on average. KALU shares have gained 39.1% in a year.
BrightSphere Investment Group Inc. (BSIG - Free Report) : Based in Boston, MA, the company is an international asset management firm that operates in the financial services sector. Over the past 60 days, the Zacks Consensus Estimate for 2024 earnings has moved up 7.9%. BSIG has a VGM Score of A.
BrightSphere Investment Group beat the Zacks Consensus Estimate for earnings in two of the last four quarters, met in one and missed in the other. It has a trailing four-quarter earnings surprise of roughly 21.1%, on average. BSIG shares have lost 4.5% in a year.
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 Top-Ranked Relative Price Strength Stocks for Your Basket
U.S. stock markets witnessed an astonishing rally in the past 15 months. Following a strong 2023, Wall Street has continued its impressive run this year, too, with the S&P 500 surging 10.2% during this period. Notably, the last quarter was its strongest first-quarter showing since 2019. We anticipate the bullish momentum to prevail, bolstered by a robust U.S. economy.
However, the U.S. inflation rate remains stubborn despite a restrictive monetary policy and an extremely high interest rate regime in the last 24 months. Fed officials are concerned that even after declining to a great extent from its peak in June 2022, the inflation rate is yet to show any convincing evidence that it is moving gradually to the targeted level of 2%.
Given these wide-ranging factors, investors are turning their attention to stocks with a strong relative price performance. This allows them to seize promising opportunities that offer the potential for high returns.
Relative Price Strength Strategy
Earnings growth and valuation multiples are indeed important for investors to determine a stock's ability to offer considerable returns. But these are also essential for determining whether a stock’s price performance is better than its peers or the industry average.
If a stock’s performance is lacking that of the broader groups, despite impressive earnings growth or valuation multiples, then something must be wrong.
It’s always advisable to stay away from these stocks and bet on those that are outperforming their respective industry or benchmark. This is because betting on a winner always proves to be lucrative.
Then again, it is imperative that you determine whether or not an investment has relevant upside potential when considering stocks with significant relative price strength. Stocks delivering better than the S&P 500 for 1 to 3 months at least and having solid fundamentals indicate room for growth and are the best ways to go about this strategy.
Finally, it is crucial to find out whether analysts are optimistic about the upcoming earnings of these companies. In order to do this, we have added positive estimate revisions for the current quarter’s (Q1) earnings to our screen. When a stock undergoes an upward revision, it leads to additional price gains.
Screening Parameters
Relative % Price change – 12 weeks greater than 0
Relative % Price change – 4 weeks greater than 0
Relative % Price change – 1 week greater than 0
(We have considered those stocks that have been outperforming the S&P 500 over the last 12 weeks, four weeks and one week.)
% Change (Q1) Est. over 4 Weeks greater than 0: Positive current-quarter estimate revisions over the last four weeks.
Zacks Rank equal to 1: Only Zacks Rank #1 (Strong Buy) stocks — that have returned more than 26% annually over the last 26 years and surpassed the S&P 500 in 23 of the last 26 years — can get through. You can see the complete list of today’s Zacks #1 Rank stocks here.
Current Price greater than or equal to $5 and Average 20-day Volume greater than or equal to 50,000: A minimum price of $5 is a good standard to screen low-priced stocks, while a high trading volume would imply adequate liquidity.
VGM Score less than or equal to B: Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best upside potential.
Here are the five stocks that made it through the screen:
GigaCloud Technology Inc. (GCT - Free Report) : Based in El Monte, CA, the company is a B2B e-commerce and logistics solutions provider. GCT has a trailing four-quarter earnings surprise of roughly 42.3%, on average. The company has a VGM Score of B.
Notably, the Zacks Consensus Estimate for GigaCloud Technology’s 2024 earnings per share indicates 12.2% year-over-year growth. The company has a market capitalization of $1.4 billion. GCT shares have gone up 594.5% in a year.
Murphy USA Inc. (MUSA - Free Report) : The company is a leading independent retailer of motor fuel and convenience merchandise in the United States. The Zacks Consensus Estimate for 2024 earnings of this firm indicates 3.6% growth. Headquartered in El Dorado, AR, MUSA has a VGM Score of A.
Over the past 60 days, the Zacks Consensus Estimate for 2024 has moved up 4.1%. Murphy USA has a trailing four-quarter earnings surprise of roughly 13.6%, on average. MUSA shares have increased 51.5% in a year.
HCI Group, Inc. (HCI - Free Report) : The company specializes in offering residential insurance solutions, including homeowners, fire, flood, and wind-only insurance, catering to a diverse range of clients. Over the past 60 days, this Tampa, FL-based firm saw the Zacks Consensus Estimate for 2024 move up 38.8%. HCI has a VGM Score of A.
The Zacks Consensus Estimate for 2024 earnings of HCI Group Group indicates 39.4% growth. The company beat the Zacks Consensus Estimate for earnings in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 522.5%, on average. HCI shares have gained 101.3% in a year.
Kaiser Aluminum Corporation (KALU - Free Report) : The company produces semi-fabricated specialty aluminum products used in a wide range of industries. The Zacks Consensus Estimate for 2024 earnings of this firm indicates 33.2% growth. Headquartered in Franklin, TN, KALU has a VGM Score of A.
Over the past 60 days, the Zacks Consensus Estimate for 2024 has moved up 22.9%. Kaiser Aluminum has a trailing four-quarter earnings surprise of roughly 157.2%, on average. KALU shares have gained 39.1% in a year.
BrightSphere Investment Group Inc. (BSIG - Free Report) : Based in Boston, MA, the company is an international asset management firm that operates in the financial services sector. Over the past 60 days, the Zacks Consensus Estimate for 2024 earnings has moved up 7.9%. BSIG has a VGM Score of A.
BrightSphere Investment Group beat the Zacks Consensus Estimate for earnings in two of the last four quarters, met in one and missed in the other. It has a trailing four-quarter earnings surprise of roughly 21.1%, on average. BSIG shares have lost 4.5% in a year.
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.