3 Intriguing Stocks to Buy for Value and Growth Potential
Stocks that have exposure or dominance in markets that can be boosted by broader economic growth are very intriguing.
Several top-rated Zacks stocks appear to fit the bill. Let’s take a look at three of these stocks that are worthy of investors’ consideration at the moment.
ePlus (PLUS)
Boasting a Zacks Rank #1 (Strong Buy) ePlus stock is very intriguing as a leading provider of technology solutions.
The strong performance of the Nasdaq this year has investors searching for tech stocks that could continue rising. This could be the case for ePlus stock which is up 25% YTD to slightly trail the Nasdaq’s +31% but easily top the S&P 500’s +16%.
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The market environment is looking strong for ePlus as its Business-Software Services Industry is in the top 19% of over 250 Zacks industries. ePlus looks poised to continue benefiting with the company enabling organizations to optimize their IT infrastructure and supply chain processes.
ePlus stock looks undervalued as earnings are forecasted to dip -8% in its current fiscal 2024 at $4.61 per share following a record year that saw EPS at $5.02 in the company’s FY23. Still, FY25 earnings are forecasted to rebound and rise 7% to $4.92 per share.
Piggybacking off of ePlus' value, its price-to-earnings valuation is very attractive considering the premium tech stocks can command. Trading at $55 a share and 12.1X forward earnings, ePlus trades at a considerable discount to the industry average of 22.3X and nicely beneath the S&P 500’s 20.6X.
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Rush Enterprises (RUSHA)
Retail auto dealer Rush Enterprises is starting to stand out with a Zacks Rank #2 (Buy). Rush operates the largest network of Peterbilt heavy-duty truck dealerships in North America and John Deere construction equipment dealerships in Texas and Michigan.
Following a record year for revenue and profitability, Rush stock is up 14% in 2023 and its P/E valuation is enticing with earnings estimates higher over the last 60 days. Fiscal 2023 earnings are now expected at $5.61 per share with Rush stock trading around $60 and just 10.7X forward earnings.
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While Rush is trading modestly above its industry average of 7.2X forward earnings the company is a leader in its space and trades well below the benchmark’s 20.6X. Furthermore, Rush stock trades 75% below its decade-long high of 41X and at a 25% discount to the median of 14.2X.
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Sterling Infrastructure (STRL)
Also sporting a Zacks Rank #2 (Buy) Sterling Infrastructure stock has been very intriguing since the company announced in February that it was awarded a landmark site development project for the Hyundai Engineering America New EV Battery Facility in Georgia.
In fact, the E-infrastructure, building and transportation solutions company has now seen its stock soar 59% this year to largely outperform the broader indexes. More astonishing, Sterling stock is now up +447% over the last decade to vastly outperform the S&P 500’s +180% and even the Nasdaq’s +309%.
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Investors have been clinging to get in on Sterling’s recent growth with fiscal 2023 earnings projected to rise 11% to $3.52 per share after what was a previous record year that saw EPS at $3.16 in 2022. Plus, fiscal 2024 earnings are expected to jump another 16% at $4.11 per share.
Even better, Sterling’s stock still trades reasonably at $52 a share and 15X forward earnings. This is nicely beneath its industry average of 17.4X and the benchmark.
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Takeaway
These companies are attractively placed in their industries as leaders that can benefit from economic expansion. At the moment, ePlus, Rush Enterprises, and Sterling Infrastructure stock all have an overall “A” VGM Zacks Style Scores grade for the combination of Value, Growth, and Momentum.
As inflation continues to ease their strong performances could continue making them viable investments for 2023 and beyond.
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Rush Enterprises, Inc. (RUSHA) : Free Stock Analysis Report
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ePlus inc. (PLUS) : Free Stock Analysis Report
