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3 Stocks to Buy on Hopes of the September Trend Bucking
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September has been historically considered to be the worst trading month of the year on Wall Street. So much so that, since 1925, September has been the only month to return negative, per Fisher Investments data.
There are various reasons behind this phenomenon. September ushers in the end of the summer vacations, and traders rebalance portfolios, waking up to new market realities. This increases trading volume, and stock prices feel the heat. People rush to the safety of bond markets and invest money they would otherwise invest in the stock market.
Additionally, some of September’s worst returns have coincided with gigantic economic downturns like the Great Depression years, the tech bubble burst in the early 2000s and the sub-prime crisis during 2007-2009. These events have contributed to the month’s notorious reputation.
This is also a presidential election year, and investors are trying to price that in. Historically, election years have returned better Septembers than is the norm. September’s median return in presidential election years is 0.3%. However, with the almost certain announcement of a 25 basis point rate cut from the Fed’s September meeting this year, the possibility that 2024 may buck the trend has grown stronger. In fact, a sizeable number of responders are expecting up to a 50 basis point cut from the September meeting, per CME’s FedWatch tool.
It will be thus prudent to look for stocks that are supposed to buck this September trend and do well on the back of the Fed loosening of monetary policy.
The stocks below flaunt a Zacks Rank #1 (Strong Buy) or Rank #2 (Buy). The search was also narrowed down with a VGM Score of A or B. Here, V stands for Value, G for Growth and M for Momentum. The score is a weighted combination of these three metrics. Such a score allows you to eliminate the negative aspects of stocks and select winners. You can see the complete list of today’s Zacks #1 Rank stocks here.
Abercrombie & Fitch Co. (ANF - Free Report) is an omnichannel retailer. ANF’s expected earnings growth rate for the next year is 60.5%. The Zacks Consensus Estimate for its current-year earnings has improved 9% over the past 60 days. This Zacks Rank #1 company has a VGM Score of A.
Boot Barn Holdings, Inc. (BOOT - Free Report) operates specialty retail stores. BOOT’s expected earnings growth rate for the current year is 8.9%. The Zacks Consensus Estimate for its current-year earnings has improved 9.5% over the past 60 days. This Zacks Rank #1 company has a VGM Score of A.
Delek Logistics Partners, LP (DKL - Free Report) is a provider of gathering, pipeline, transportation and other services for the energy market. DKL’s expected earnings growth rate for the current year is 5.6%. The Zacks Consensus Estimate for its current-year earnings has improved 4.3% over the past 60 days. This Zacks Rank #1 company has a VGM Score of B.
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3 Stocks to Buy on Hopes of the September Trend Bucking
September has been historically considered to be the worst trading month of the year on Wall Street. So much so that, since 1925, September has been the only month to return negative, per Fisher Investments data.
There are various reasons behind this phenomenon. September ushers in the end of the summer vacations, and traders rebalance portfolios, waking up to new market realities. This increases trading volume, and stock prices feel the heat. People rush to the safety of bond markets and invest money they would otherwise invest in the stock market.
Additionally, some of September’s worst returns have coincided with gigantic economic downturns like the Great Depression years, the tech bubble burst in the early 2000s and the sub-prime crisis during 2007-2009. These events have contributed to the month’s notorious reputation.
This is also a presidential election year, and investors are trying to price that in. Historically, election years have returned better Septembers than is the norm. September’s median return in presidential election years is 0.3%. However, with the almost certain announcement of a 25 basis point rate cut from the Fed’s September meeting this year, the possibility that 2024 may buck the trend has grown stronger. In fact, a sizeable number of responders are expecting up to a 50 basis point cut from the September meeting, per CME’s FedWatch tool.
It will be thus prudent to look for stocks that are supposed to buck this September trend and do well on the back of the Fed loosening of monetary policy.
The stocks below flaunt a Zacks Rank #1 (Strong Buy) or Rank #2 (Buy). The search was also narrowed down with a VGM Score of A or B. Here, V stands for Value, G for Growth and M for Momentum. The score is a weighted combination of these three metrics. Such a score allows you to eliminate the negative aspects of stocks and select winners. You can see the complete list of today’s Zacks #1 Rank stocks here.
Abercrombie & Fitch Co. (ANF - Free Report) is an omnichannel retailer. ANF’s expected earnings growth rate for the next year is 60.5%. The Zacks Consensus Estimate for its current-year earnings has improved 9% over the past 60 days. This Zacks Rank #1 company has a VGM Score of A.
Boot Barn Holdings, Inc. (BOOT - Free Report) operates specialty retail stores. BOOT’s expected earnings growth rate for the current year is 8.9%. The Zacks Consensus Estimate for its current-year earnings has improved 9.5% over the past 60 days. This Zacks Rank #1 company has a VGM Score of A.
Delek Logistics Partners, LP (DKL - Free Report) is a provider of gathering, pipeline, transportation and other services for the energy market. DKL’s expected earnings growth rate for the current year is 5.6%. The Zacks Consensus Estimate for its current-year earnings has improved 4.3% over the past 60 days. This Zacks Rank #1 company has a VGM Score of B.