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8 Stocks with Recent Price Strength to Enhance Your Returns
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Investors always seek a winning strategy. However, finding such a strategy is easier said than done. When the markets are choppy marked by widespread global growth concerns, it is difficult for even an insightful investor to come up with a foolproof approach.
No matter how disciplined and systematic investors are, equity market volatility will always manage to get the better of them. While a few lucky ones rake in the moolah, others fall victim to ad hoc strategies.
One could resort to commonly used techniques to find beaten down stocks that have the potential to recover faster than others. However, even such investment choices bear the risk of disappointment. Particularly, one could be stuck in a value trap if the hidden weaknesses in selected stock are not identified.
So, wouldn’t it be a safer strategy to look for stocks that are winners currently and have the potential to gain further?
Here’s how to execute it:
One should primarily look for stocks that have recently been witnessing price increase. Actually, stocks seeing price strength recently have a high chance of carrying the momentum forward.
If a stock is continuously moving higher, there must be a good reason for the rise or else it probably would have fallen like the losers. So, looking at stocks that have already won the game and are capable of beating the benchmark that they have set is rational.
However, recent price strength alone cannot create magic, so you need to set other relevant parameters to create a successful investment strategy.
Here’s how you should create the screen to shortlist the current as well as the potential winners.
Screening Parameters:
Percentage Change in Price (4 Weeks) greater than zero: This criterion shows that the stock has moved higher in the last four weeks.
Percentage Change Price (12 Weeks) greater than 10: This indicates that the stock has seen momentum over the last three months. This lowers the risk of choosing stocks that may have drawn attention due to the overwhelming performance of the overall market in a very short period.
Zacks Rank 1: No matter whether market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) have a proven history of outperformance. You can see the complete list of today’s Zacks #1 Rank stocks here.
Average Broker Rating 1: This indicates that brokers are also highly hopeful about the stock’s future performance.
Current Price greater than 5: The stocks must all be trading at a minimum of $5.
Current Price/ 52-Week High-Low Range more than 85%: This criterion filters stocks that are trading near their respective 52-week highs. It indicates that these are strong enough in terms of price.
Here are eight of the 21 stocks that made it through this screen:
Xcerra Corporation engages in designing, manufacturing, and marketing automatic test equipment for the semiconductor industry. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, with an average positive surprise of 97.50%.
Glaukos Corporation (GKOS - Free Report) is an ophthalmic medical technology company. The company develops, manufactures and markets medical devices for the treatment of glaucoma. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, with an average positive surprise of 196.23%.
Nova Measuring Instruments Ltd. (NVMI - Free Report) develops, produces and markets monitoring and measurement systems for the semiconductor manufacturing industry. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, with an average positive surprise of 31.07%.
Customers Bancorp Inc. (CUBI - Free Report) is a bank holding company of Customers Bank, a state-chartered bank in Pennsylvania. It provides banking services to small and medium-sized businesses, professionals, individuals and families. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, with an average positive surprise of 9.67%.
DNB Financial Corporation is a bank holding company of DNB Financial Corporation that offers various commercial banking products and services for individuals and corporate customers in southeastern Pennsylvania. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, with an average positive surprise of 14.86%.
Apogee Enterprises Inc. (APOG - Free Report) is a leader in technologies involving the design and development of value-added glass products and services. The company surpassed the Zacks Consensus Estimate thrice while missing the same on one occasion in the trailing four quarters. It has an average positive earnings surprise of 13.24%.
EXFO Inc. is a provider of next-generation test and service assurance solutions for wireless and wireline network operators and equipment manufacturers in the global telecommunications industry. The company surpassed the Zacks Consensus Estimate thrice while missing the same on one occasion in the trailing four quarters. It has an average positive earnings surprise of 23.75%.
Eagle Bancorp Montana, Inc. (EBMT - Free Report) operates as a holding company for American Federal Savings Bank that provides retail banking services in the south central portion of Montana. The company surpassed the Zacks Consensus Estimate thrice while matching the same on one occasion in the trailing four quarters. It has an average positive earnings surprise of 19.05%.
Get the rest of the stocks on the list and start putting this and other ideas to the test. It can all be done with the Research Wizard stock picking and backtesting software.
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.
Zacks Restaurant Recommendations: In addition to dining at these special places, you can feast on their stock shares. A Zacks Special Report spotlights 5 recent IPOs to watch plus 2 stocks that offer immediate promise in a booming sector. Download it free »
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8 Stocks with Recent Price Strength to Enhance Your Returns
Investors always seek a winning strategy. However, finding such a strategy is easier said than done. When the markets are choppy marked by widespread global growth concerns, it is difficult for even an insightful investor to come up with a foolproof approach.
No matter how disciplined and systematic investors are, equity market volatility will always manage to get the better of them. While a few lucky ones rake in the moolah, others fall victim to ad hoc strategies.
One could resort to commonly used techniques to find beaten down stocks that have the potential to recover faster than others. However, even such investment choices bear the risk of disappointment. Particularly, one could be stuck in a value trap if the hidden weaknesses in selected stock are not identified.
So, wouldn’t it be a safer strategy to look for stocks that are winners currently and have the potential to gain further?
Here’s how to execute it:
One should primarily look for stocks that have recently been witnessing price increase. Actually, stocks seeing price strength recently have a high chance of carrying the momentum forward.
If a stock is continuously moving higher, there must be a good reason for the rise or else it probably would have fallen like the losers. So, looking at stocks that have already won the game and are capable of beating the benchmark that they have set is rational.
However, recent price strength alone cannot create magic, so you need to set other relevant parameters to create a successful investment strategy.
Here’s how you should create the screen to shortlist the current as well as the potential winners.
Screening Parameters:
Percentage Change in Price (4 Weeks) greater than zero: This criterion shows that the stock has moved higher in the last four weeks.
Percentage Change Price (12 Weeks) greater than 10: This indicates that the stock has seen momentum over the last three months. This lowers the risk of choosing stocks that may have drawn attention due to the overwhelming performance of the overall market in a very short period.
Zacks Rank 1: No matter whether market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) have a proven history of outperformance. You can see the complete list of today’s Zacks #1 Rank stocks here.
Average Broker Rating 1: This indicates that brokers are also highly hopeful about the stock’s future performance.
Current Price greater than 5: The stocks must all be trading at a minimum of $5.
Current Price/ 52-Week High-Low Range more than 85%: This criterion filters stocks that are trading near their respective 52-week highs. It indicates that these are strong enough in terms of price.
Here are eight of the 21 stocks that made it through this screen:
Xcerra Corporation engages in designing, manufacturing, and marketing automatic test equipment for the semiconductor industry. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, with an average positive surprise of 97.50%.
Glaukos Corporation (GKOS - Free Report) is an ophthalmic medical technology company. The company develops, manufactures and markets medical devices for the treatment of glaucoma. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, with an average positive surprise of 196.23%.
Nova Measuring Instruments Ltd. (NVMI - Free Report) develops, produces and markets monitoring and measurement systems for the semiconductor manufacturing industry. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, with an average positive surprise of 31.07%.
Customers Bancorp Inc. (CUBI - Free Report) is a bank holding company of Customers Bank, a state-chartered bank in Pennsylvania. It provides banking services to small and medium-sized businesses, professionals, individuals and families. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, with an average positive surprise of 9.67%.
DNB Financial Corporation is a bank holding company of DNB Financial Corporation that offers various commercial banking products and services for individuals and corporate customers in southeastern Pennsylvania. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, with an average positive surprise of 14.86%.
Apogee Enterprises Inc. (APOG - Free Report) is a leader in technologies involving the design and development of value-added glass products and services. The company surpassed the Zacks Consensus Estimate thrice while missing the same on one occasion in the trailing four quarters. It has an average positive earnings surprise of 13.24%.
EXFO Inc. is a provider of next-generation test and service assurance solutions for wireless and wireline network operators and equipment manufacturers in the global telecommunications industry. The company surpassed the Zacks Consensus Estimate thrice while missing the same on one occasion in the trailing four quarters. It has an average positive earnings surprise of 23.75%.
Eagle Bancorp Montana, Inc. (EBMT - Free Report) operates as a holding company for American Federal Savings Bank that provides retail banking services in the south central portion of Montana. The company surpassed the Zacks Consensus Estimate thrice while matching the same on one occasion in the trailing four quarters. It has an average positive earnings surprise of 19.05%.
Get the rest of the stocks on the list and start putting this and other ideas to the test. It can all be done with the Research Wizard stock picking and backtesting software.
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.
Zacks Restaurant Recommendations: In addition to dining at these special places, you can feast on their stock shares. A Zacks Special Report spotlights 5 recent IPOs to watch plus 2 stocks that offer immediate promise in a booming sector. Download it free »