Wall Street started 2019 with a lot of vigor, quickly erasing the loss it suffered in 2018. The U.S. economy is in good shape and the Fed has decided to practice patience on rate hike. Inflation is also under the 2% benchmark of the central bank.
However, of late, investors are concerned about an impending global economic slowdown that may hinder the growth of the U.S. economy.
On Mar 7, the European Central Bank lowered the 2019 growth projection for the 19-member Eurozone to 1.1% from its earlier projection of 1.7%. On Feb 6, the European Commission lowered the 2019 growth projection for Eurozone from 1.9% in November to 1.3%.
On Mar 4, Chinese premier Li Keqiang’s annual work report presented to the National People’s Congress pegged the country’s growth rate at the 6-6.5% range for 2019. Notably, China’s growth rate in 2018 was 6.6%.
On Feb 4, Bank of England reduced the 2019 growth rate for the U.K. to 1.2% from 1.7% forecast earlier. Economic projection for 2020 was also trimmed to 1.5%. The root cause for this likely slowdown is the Brexit-related conundrum.
Wall Street Loses Momentum
Due to global economic concerns and some weak economic data of the U.S. economy, all the three major stock indexes ended in the red for the first time in 2019 for the week ended Mar 8. However, indexes are firmly in the positive territory so far in 2019.
5 Stocks Moving Higher Despite Concerns
The recent concerns have not however stalled the market’s growth entirely. We have been able to narrow down our search on five stocks, which have moved higher and still hold potential provide further upside. All five stocks currently sport a Zacks Rank #1 (Strong Buy) and VGM Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.
Abercrombie & Fitch Co. ANF operates as a specialty retailer of premium, high-quality casual apparel for men, women, and kids. The company made significant progress in expanding its digital and omni-channel capabilities. Notably, digital engagement with consumers has been its core strength.
The stock has surged 27.8% year to date. The company has an expected earnings growth rate of 20.9% for the current year. The Zacks Consensus Estimate for the current year has improved 41.8% over the last 60 days.
RH RH is a leading luxury retailer in the home furnishing space. Its key positive is management’s transformation of business from a promotional to a membership model (RH Members Program), which has significantly enhanced its brand, streamlined operations and improved customer experience.
The membership model has eliminated the frantic buying patterns and associated returns, exchanges and canceled orders. This is expected to contribute to improved financial performance through higher conversion of demand into revenues, improved margins and lower costs.
The stock has surged 17.3% year to date. The company has expected an earnings growth rate of 18.1% for the current year. The Zacks Consensus Estimate for the current year has improved 4% over the last 60 days.
Quanta Services Inc. PWR is a leading national provider of specialty contracting services, and one of the largest contractors serving the transmission and distribution sector of the North American electric utility industry.
Quanta Services is experiencing solid prospects in its electric power segment. Its communications infrastructure services business is performing exceptionally. Prospects of the Electric Power segment remain robust, given customers’ investment for in their grid modernization programs.
The stock has surged 16.9% year to date. The company has expected earnings growth of 25.3% for the current year. The Zacks Consensus Estimate for the current year has improved 7.3% over the last 60 days.
SkyWest Inc. SKYW operates as a regional airline in the United States through its subsidiary SkyWest Airlines. It sports a Zacks Rank #1 and VGM Score of A.
SkyWest's sale of its subsidiary, ExpressJet Airlines, to a joint venture in January 2019 was a big boost to its profitability. SkyWest’s efforts to modernize its fleet and streamline operations are the other major positives.
The stock has gained 12.5% year to date. The company has expected earnings growth of 9.1% for the current year. The Zacks Consensus Estimate for the current year has improved 5.3% over the last 60 days.
Anthem Inc. ANTM is one of the largest publicly traded managed care organizations in terms of membership. The company has been actively collaborating and acquiring companies for enhancing its expansion process. Its buyout of HealthSun and America's 1st Choice has aided revenue growth.
The stock has added 12.4% year to date. The company has an expected earnings growth rate of 20.4% for the current year. The Zacks Consensus Estimate for the current year has improved 8.8% over the last 60 days.
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-holds for the year?
Who wouldn't? Our annual Top 10s have beaten the market with amazing regularity. In 2018, while the market dropped -5.2%, the portfolio scored well into double-digits overall with individual stocks rising as high as +61.5%. And from 2012-2017, while the market boomed +126.3, Zacks' Top 10s reached an even more sensational +181.9%.
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