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Welcome to Episode #412 of the Zacks Market Edge Podcast.
Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds, and ETFs and how it impacts your life.
This week, Zacks Stock Strategist, Ben Rains, who is also the editor of the Alternative Energy Innovators and Marijuana Innovators newsletters, joined the discussion on screening for top stocks on Zacks.com.
With volatility picking up on Wall Street, now is the time to find quality companies to invest in. But with thousands of publicly traded companies, how do you do that?
One method to narrow the list of stocks is to deploy the top screening tools on Zacks, including the Zacks Rank and the Style Scores.
Screening for the Best of the Best Stock Picks
Zacks has a premium screen on Zacks.com called “Best of the Best.” This screen looks for stocks with a Style Score VGM, which is the composite score of value, growth and momentum, of A. A is the highest Style Score.
It also looks for Zacks #1 Rank (Strong Buy) stocks. This is the top ranking. There are only a little over 200 stocks that will have this top ranking on any given day.
Why do investors want the Strong Buy rank? It usually means the analysts are raising their earnings estimates. When that is happening, it usually means something good is going on at the company. Perhaps the company reported earnings and beat and raised its full year guidance.
It is rare to find stocks that have both the top Zacks Rank AND the top VGM Style Score which is why the screen is called the “best of the best.”
This screen returned just 19 stocks.
5 Best of the Best Stock Picks with Top Zacks Rank and VGM Scores
H&R Block, the tax preparation company, is still dirt cheap even though the stock has soared 59% in the last year. H&R Block has a Zacks Style Score of A for value, the top score. It has a forward P/E of just 11.8.
H&R Block also has the growth. Earnings are expected to rise 12.3% this fiscal year. H&R Block has recently fallen to a Zacks Rank #2 (Buy) stock from the #1 (Strong Buy) at the time the podcast was recorded.
Should H&R Block be on your short list even after its big rally?
Abercrombie & Fitch is having a renaissance. This apparel and accessories retailer has found the right combination of product again and is attracting a new customer.
Shares of Abercrombie & Fitch have been soaring, gaining 63.4% year-to-date, but they have taken a timeout in the last month, falling back 19%. Abercrombie & Fitch has a Value Style Score of A with a forward price-to-earnings (P/E) ratio of 14.9. That is under the 15x value investors look for.
Earnings are expected to jump 51% this fiscal year. Abercrombie & Fitch still maintains its Zacks #1 (Strong Buy) rank.
Is this sell-off a buying opportunity in Abercrombie & Fitch?
Powell Industries makes custom engineered equipment that distributes and controls the flow of electrical energy to the oil, gas, and petrochemical industries. It is a small cap company with a market cap of just $1.9 billion.
Shares of Powell Industries have soared year-to-date, gaining 82%. But it still has a Zacks Value Style Score of B, the second highest. Powell Industries has an attractive price-to-earnings (P/E) ratio of just 13.7. Earnings are also expected to jump 191% this year.
Is it time to consider a top small cap stock, like Powell Industries?
EMCOR Group is in mechanical and electrical construction, industrial and energy infrastructure and building services. It’s a large cap company with a market cap of $16 billion.
Shares of EMCOR have rallied 84% year-to-date but have eased off the highs in the last month, falling 2.5%. EMCOR has a Growth Style Score of A, the highest score. Earnings are expected to rise 35% this year.
Should an infrastructure company like EMCOR be on your short list?
Universal Health Services is one of the largest providers of hospitals and healthcare services in the United States. It recently raised its share buyback by $1 billion.
Shares of Universal Health Services are up 42% year-to-date. It is also one of the rare stocks that isn’t pulling back this summer but, instead, has gained 20% in the last month. Universal Health Services has the top Style Score for Growth of A. Earnings are expected to jump 47% in 2024.
Should a hospital provider like Universal Health Services be on your short list?
What else do you need to know about the best of the best stock picks?
Tune into this week’s video podcast to find out.
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5 Best of the Best Stock Picks: Strong Buys and VGM of A
Welcome to Episode #412 of the Zacks Market Edge Podcast.
Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds, and ETFs and how it impacts your life.
This week, Zacks Stock Strategist, Ben Rains, who is also the editor of the Alternative Energy Innovators and Marijuana Innovators newsletters, joined the discussion on screening for top stocks on Zacks.com.
With volatility picking up on Wall Street, now is the time to find quality companies to invest in. But with thousands of publicly traded companies, how do you do that?
One method to narrow the list of stocks is to deploy the top screening tools on Zacks, including the Zacks Rank and the Style Scores.
Screening for the Best of the Best Stock Picks
Zacks has a premium screen on Zacks.com called “Best of the Best.” This screen looks for stocks with a Style Score VGM, which is the composite score of value, growth and momentum, of A. A is the highest Style Score.
It also looks for Zacks #1 Rank (Strong Buy) stocks. This is the top ranking. There are only a little over 200 stocks that will have this top ranking on any given day.
Why do investors want the Strong Buy rank? It usually means the analysts are raising their earnings estimates. When that is happening, it usually means something good is going on at the company. Perhaps the company reported earnings and beat and raised its full year guidance.
It is rare to find stocks that have both the top Zacks Rank AND the top VGM Style Score which is why the screen is called the “best of the best.”
This screen returned just 19 stocks.
5 Best of the Best Stock Picks with Top Zacks Rank and VGM Scores
1. H&R Block, Inc. (HRB - Free Report)
H&R Block, the tax preparation company, is still dirt cheap even though the stock has soared 59% in the last year. H&R Block has a Zacks Style Score of A for value, the top score. It has a forward P/E of just 11.8.
H&R Block also has the growth. Earnings are expected to rise 12.3% this fiscal year. H&R Block has recently fallen to a Zacks Rank #2 (Buy) stock from the #1 (Strong Buy) at the time the podcast was recorded.
Should H&R Block be on your short list even after its big rally?
2. Abercrombie & Fitch Co. (ANF - Free Report)
Abercrombie & Fitch is having a renaissance. This apparel and accessories retailer has found the right combination of product again and is attracting a new customer.
Shares of Abercrombie & Fitch have been soaring, gaining 63.4% year-to-date, but they have taken a timeout in the last month, falling back 19%. Abercrombie & Fitch has a Value Style Score of A with a forward price-to-earnings (P/E) ratio of 14.9. That is under the 15x value investors look for.
Earnings are expected to jump 51% this fiscal year. Abercrombie & Fitch still maintains its Zacks #1 (Strong Buy) rank.
Is this sell-off a buying opportunity in Abercrombie & Fitch?
3. Powell Industries, Inc. (POWL - Free Report)
Powell Industries makes custom engineered equipment that distributes and controls the flow of electrical energy to the oil, gas, and petrochemical industries. It is a small cap company with a market cap of just $1.9 billion.
Shares of Powell Industries have soared year-to-date, gaining 82%. But it still has a Zacks Value Style Score of B, the second highest. Powell Industries has an attractive price-to-earnings (P/E) ratio of just 13.7. Earnings are also expected to jump 191% this year.
Is it time to consider a top small cap stock, like Powell Industries?
4. EMCOR Group, Inc. (EME - Free Report)
EMCOR Group is in mechanical and electrical construction, industrial and energy infrastructure and building services. It’s a large cap company with a market cap of $16 billion.
Shares of EMCOR have rallied 84% year-to-date but have eased off the highs in the last month, falling 2.5%. EMCOR has a Growth Style Score of A, the highest score. Earnings are expected to rise 35% this year.
Should an infrastructure company like EMCOR be on your short list?
5. Universal Health Services, Inc. (UHS - Free Report)
Universal Health Services is one of the largest providers of hospitals and healthcare services in the United States. It recently raised its share buyback by $1 billion.
Shares of Universal Health Services are up 42% year-to-date. It is also one of the rare stocks that isn’t pulling back this summer but, instead, has gained 20% in the last month. Universal Health Services has the top Style Score for Growth of A. Earnings are expected to jump 47% in 2024.
Should a hospital provider like Universal Health Services be on your short list?
What else do you need to know about the best of the best stock picks?
Tune into this week’s video podcast to find out.