We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
3 Powerful Examples of the Zacks Rank: NVIDIA, Netflix & Alphabet
Stocks with rising earnings estimates have significantly outperformed the S&P 500 year after year, whereas stocks with falling earnings estimates have underperformed the S&P 500 year after year.
The Zacks Rank has made the process of identifying stocks with changing earnings estimates easy and very profitable. It’s a reliable tool that helps you trade with confidence regardless of your trading style and/or risk tolerance.
The Zacks Rank uses four factors related to earnings estimates to classify stocks into five groups, ranging from ‘Strong Buy’ to ‘Strong Sell.’ Importantly, it allows individual investors to take advantage of trends in earnings estimate revisions and benefit from the power of institutional investors.
Let’s take a closer look at the Zacks Rank in action across several stocks, including beloved Nvidia, Netflix and Alphabet.
Nvidia Shares Keep Climbing
Investor-favorite Nvidia reclaimed its Zacks Rank #1 (Strong Buy) rating on May 30th, with shares gaining nearly 10% since. The stock has held a favorable ranking for an extended period now, reflective of analysts’ bullish outlooks regarding its Data Center sales.
Robust quarterly results are expected to keep coming, with the company forecasted to see 130% EPS growth on 110% higher sales in its upcoming release. The company’s revenue growth has been remarkable over the years.
And the growth picture remains bright thanks to demand for H200 and Blackwell that’s currently well ahead of supply, with demand potentially exceeding supply well into next year. The H200’s larger and faster memory fuels the acceleration of generative AI and large language models (LLMs) while advancing scientific computing for HPC workloads.
Netflix Shares Up 11%
Netflix obtained the highly-coveted Zacks Rank #1 (Strong Buy) back on May 3, with shares up nearly 11% since. The company’s latest set of quarterly results caused shares to face some pressure but have since erased the declines.
Analysts have raised their earnings expectations across the board, with positive revisions following the above-mentioned set of quarterly results.
The streaming giant enjoyed a solid quarter, posting $2.1 billion in free cash flow and seeing its year-to-date operating margin moving higher to 28.1% (20.6% in FY23). The company also maintained its free cash flow outlook of $6 billion for FY24 and repurchased 3.6 million shares throughout the period.
The company’s growth outlook remains bright, with consensus expectations for its current fiscal year suggesting 52% earnings growth on 15% higher sales. The stock sports a Style Score of ‘A’ for Growth.
Alphabet Shares Aren't Expensive
Alphabet was upgraded to a Zacks Rank #1 (Strong Buy) on April 30, with shares gaining 7% since. Like those above, the company’s earnings outlook has become bright across the board.
Shares aren’t overly expensive given the company’s forecasted growth, as the current 21.7X forward 12-month earnings multiple sits right at the five-year median and well beneath five-year highs of 32.6X. Alphabet’s forecasted to enjoy 31% EPS growth on 15% higher sales in its current fiscal year, with consensus expectations for FY25 alluding to an additional 13% earnings growth on 12% higher revenue.
The multiple also compares favorably to the Zacks Computer and Technology sector average of 27.1X.
Bottom Line
As the examples above show, listening to the Zacks Rank can consistently result in market-beating gains, as positive earnings estimate revisions provide the fuel needed to move higher.
All three stocks above presently sport a Zacks Rank #1 (Strong Buy), reflecting upward trending earnings estimate revisions.
Visit Zacks Rank Education to learn more about using this proven system for market-beating gains.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
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 https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Zacks Investment Ideas feature highlights: Nvidia, Netflix and Alphabet
For Immediate Release
Chicago, IL – June 12, 2024 – Today, Zacks Investment Ideas feature highlights Nvidia (NVDA - Free Report) , Netflix (NFLX - Free Report) and Alphabet (GOOGL - Free Report) .
3 Powerful Examples of the Zacks Rank: NVIDIA, Netflix & Alphabet
Stocks with rising earnings estimates have significantly outperformed the S&P 500 year after year, whereas stocks with falling earnings estimates have underperformed the S&P 500 year after year.
The Zacks Rank has made the process of identifying stocks with changing earnings estimates easy and very profitable. It’s a reliable tool that helps you trade with confidence regardless of your trading style and/or risk tolerance.
The Zacks Rank uses four factors related to earnings estimates to classify stocks into five groups, ranging from ‘Strong Buy’ to ‘Strong Sell.’ Importantly, it allows individual investors to take advantage of trends in earnings estimate revisions and benefit from the power of institutional investors.
Let’s take a closer look at the Zacks Rank in action across several stocks, including beloved Nvidia, Netflix and Alphabet.
Nvidia Shares Keep Climbing
Investor-favorite Nvidia reclaimed its Zacks Rank #1 (Strong Buy) rating on May 30th, with shares gaining nearly 10% since. The stock has held a favorable ranking for an extended period now, reflective of analysts’ bullish outlooks regarding its Data Center sales.
Robust quarterly results are expected to keep coming, with the company forecasted to see 130% EPS growth on 110% higher sales in its upcoming release. The company’s revenue growth has been remarkable over the years.
And the growth picture remains bright thanks to demand for H200 and Blackwell that’s currently well ahead of supply, with demand potentially exceeding supply well into next year. The H200’s larger and faster memory fuels the acceleration of generative AI and large language models (LLMs) while advancing scientific computing for HPC workloads.
Netflix Shares Up 11%
Netflix obtained the highly-coveted Zacks Rank #1 (Strong Buy) back on May 3, with shares up nearly 11% since. The company’s latest set of quarterly results caused shares to face some pressure but have since erased the declines.
Analysts have raised their earnings expectations across the board, with positive revisions following the above-mentioned set of quarterly results.
The streaming giant enjoyed a solid quarter, posting $2.1 billion in free cash flow and seeing its year-to-date operating margin moving higher to 28.1% (20.6% in FY23). The company also maintained its free cash flow outlook of $6 billion for FY24 and repurchased 3.6 million shares throughout the period.
The company’s growth outlook remains bright, with consensus expectations for its current fiscal year suggesting 52% earnings growth on 15% higher sales. The stock sports a Style Score of ‘A’ for Growth.
Alphabet Shares Aren't Expensive
Alphabet was upgraded to a Zacks Rank #1 (Strong Buy) on April 30, with shares gaining 7% since. Like those above, the company’s earnings outlook has become bright across the board.
Shares aren’t overly expensive given the company’s forecasted growth, as the current 21.7X forward 12-month earnings multiple sits right at the five-year median and well beneath five-year highs of 32.6X. Alphabet’s forecasted to enjoy 31% EPS growth on 15% higher sales in its current fiscal year, with consensus expectations for FY25 alluding to an additional 13% earnings growth on 12% higher revenue.
The multiple also compares favorably to the Zacks Computer and Technology sector average of 27.1X.
Bottom Line
As the examples above show, listening to the Zacks Rank can consistently result in market-beating gains, as positive earnings estimate revisions provide the fuel needed to move higher.
All three stocks above presently sport a Zacks Rank #1 (Strong Buy), reflecting upward trending earnings estimate revisions.
Visit Zacks Rank Education to learn more about using this proven system for market-beating gains.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
See Stocks Free >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
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 https://www.zacks.com/performance for information about the performance numbers displayed in this press release.