5 Stocks With Recent Price Strength as Markets Move Northward
Wall Street has maintained its northbound journey for the past year despite recent concerns of inflation and surging yields on long-term U.S. sovereign bonds. Stock markets are likely to move northward barring occasional fluctuations buoyed by robust expectations of U.S. GDP growth this year.
Projections for U.S. GDP is increasing systematically since the beginning of this year. On Mar 17, the Fed raised its GDP forecast for 2021 to 6.5% from 4.2% in December.
On Mar 10, the Wall Street Journal reported that economists on average expect U.S. GDP to expand nearly 6% this year from 4.9% in February and 4.3% in January. Per the Wall Street Journal, this will be the largest U.S. GDP growth since 7.9% in 1983.
On Mar 9, the OECD estimated that the latest fiscal stimulus, along with faster vaccination, could increase U.S. GDP growth to 6.5% in 2021. The Oxford Economics predicted 7% U.S. GDP growth in 2021. In January, the International Monetary Fund estimated 5.1% U.S. GDP growth in 2021.
At this stage, wouldn’t it be a safer strategy to look for stocks that are winners and have the potential to gain further?
Sounds Good? Here’s How to Execute It:
One should primarily target stocks that have freshly been on a bull run. Actually, stocks seeing price strength recently have a high chance of carrying the momentum forward.
If a stock is continuously witnessing an uptrend, there must be a solid reason or else it would have probably crashed. So, looking at stocks that are capable of beating the benchmark that they have set for themselves seems rational.
However, recent price strength alone cannot create magic. Therefore, 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.
Just these few criteria have narrowed down the search from over 7,700 stocks to just 20.
Here we present five out of those 20 stocks:
Veritiv Corp. VRTV operates as a business-to-business provider of value-added packaging products and services, as well as facility solutions, print, and publishing products and services in the United States, Canada, Mexico, and internationally.
The stock price has soared 60.2% in the past four weeks. The company has expected earnings growth of 29.8% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 80% over the last 30 days.
GP Strategies Corp. GPX is a global provider of training and e-learning solutions, management consulting, and engineering services, improving the effectiveness of organizations by customizing solutions that enhance an organization's people, processes or technology.
The stock price has jumped 29.8% in the past four weeks. The company has an expected earnings growth rate of 31.5% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 24.7% over the last 30 days.
Marathon Digital Holdings Inc. MARA operates as a digital asset technology company that mines cryptocurrencies with a focus on the blockchain ecosystem and the generation of digital assets in United States.
The stock price has climbed 26.5% in the past four weeks. The company has an expected earnings growth rate of more than 100% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 75% over the last 30 days.
Danaos Corp. DAC owns and operates containerships in Australia, Asia, Europe, and the United States. It offers seaborne transportation services, such as chartering its vessels to liner companies.
The stock price has ralled 24.7% in the past four weeks. The company has an expected earnings growth rate of 97.5% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2.8% over the last 30 days.
ArcelorMittal MT is the world’s leading steel and mining company that owns and operates steel manufacturing and mining facilities in Europe, North and South America, Asia, and Africa.
The stock price has surged 15.4% in the past four weeks. The company has expected earnings growth of more than 100% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 3.7% over the last 30 days.
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
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.
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GP Strategies Corporation (GPX) : Free Stock Analysis Report
Veritiv Corporation (VRTV) : Free Stock Analysis Report
Danaos Corporation (DAC) : Free Stock Analysis Report
Marathon Digital Holdings, Inc. (MARA) : Free Stock Analysis Report
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