Beat the Market the Zacks Way: Uber, VirTra, Oracle in Focus
All three most widely followed indexes closed last week in the green. The S&P 500, the Dow Jones Industrial Average and the Nasdaq Composite advanced 0.4%, 0.3% and 0.1%, respectively. For the tech-heavy Nasdaq, this marked the seventh consecutive winning week.
Throughout the week, speculations surrounding the upcoming FOMC meeting dominated the movement in the stock market, with investors hedging their bets on whether the central bank would continue with its rate hikes. Trade was choppy as many financial analysts suspect that the artificial intelligence-led tech recovery has formed a bubble.
With mixed economic numbers and a resilient labor market, opinion remains divided on whether a rate pause will be announced at the June Fed meeting. All eyes are set this week on what Fed officials have to say at the conclusion of the June 13-14 meeting.
Regardless of market conditions, we, here at Zacks, provide investors with unbiased guidance on how to beat the market.
As usual, Zacks Research guided investors over the past three months with its time-tested methodologies. Given the prevailing market uncertainty, you may want to look at our feats to prepare better for your next action.
Here are some of our key achievements:
Universal Stainless and ADMA Surge Following Zacks Rank Upgrade
Shares of Universal Stainless & Alloy Products, Inc. USAP have soared 39.4% (versus the S&P 500’s 8.6% increase) since it was upgraded to a Zacks Rank #2 (Buy) on March 27.
Another stock, ADMA Biologics, Inc. ADMA, which was also upgraded to a Zacks Rank #2 on March 28, has returned 15.1% (versus the S&P 500’s 8.5% increase) since then.
Zacks Rank, our short-term rating system, has earnings estimate revisions at its core. Empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
This stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally audited track record, with Zacks Rank #1 stocks generating an average annual return of +24.8% since 1988.You can see the complete list of today’s Zacks Rank #1 stocks here >>>
A hypothetical portfolio of Zacks Rank #1 stocks has returned 9.7% this year (through March 6) versus 5.4% for the S&P 500 Index.
Check Universal Stainless’ historical EPS and Sales here>>>
Check ADMA’s historical EPS and Sales here>>>
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Zacks Recommendation Upgrade Drives VirTra and Iterum Higher
Shares of VirTra, Inc. VTSI and Iterum Therapeutics plc ITRM have advanced 53.1% (versus the S&P 500’s 4.8% rise) and 12.1% (versus the S&P 500’s 5.1% increase), respectively, since their Zacks Recommendation was upgraded to Outperform on April 4 and April 12, respectively.
While the Zacks Rank is our short-term rating system that is most effective over the one- to three-month holding horizon, the Zacks Recommendation aims to predict performance over the next 6 to 12 months. However, just like the Zacks Rank, the foundation for the Zacks Recommendation is trends in earnings estimate revisions.
The Zacks Recommendation classifies stocks into three groups — Outperform, Neutral and Underperform. While these recommendations are determined quantitatively, our analysts have the flexibility to override them for the 1100+ stocks they closely follow based on their better judgment of factors such as valuation, industry conditions and management effectiveness than the quantitative model.
To access our research reports with Zacks Recommendations for the 1100+ stocks we cover, click here>>>
Zacks Focus List Stocks Uber, Adobe Shoot Up
Shares of Uber Technologies, Inc. UBER, which belongs to the Zacks Focus List, have risen 29% over the past 12 weeks. The stock was added to the Focus List on August 16, 2019. Another Focus-List holding, Adobe Inc. ADBE, which was added to the portfolio on March 13, 2020, has returned 26.8% over the past 12 weeks. The S&P 500 has gained 10.2% over this period.
The Zacks Focus List is a model portfolio of 50 hand-picked stocks that possess the right fundamental ingredients to outperform the market over the next 12 months. These 50 stocks are picked from a long list of stocks with the highest Zacks Rank.
The 50-stock Zacks Focus List model portfolio returned 11.1% in Q1 2023 versus 7.5% for the S&P 500 Index. In 2022, the portfolio produced a 15.2% loss versus the S&P 500 Index’s 18% decline.
Since 1996, the Focus List portfolio has produced an annualized return of 12.9% through March 31, 2023. This compares to an 8.9% annualized return for the S&P 500 Index in the same time period.
Unlock all of our powerful research, tools and analysis, including the Focus List, Zacks #1 Rank List, Equity Research Reports, Zacks Earnings ESP Filter, Premium Screener and more, as part of Zacks Premium. Gain full access now >>
Zacks ECAP Stocks Oracle and Accenture Make Significant Gains
Oracle Corporation ORCL, a component of our Earnings Certain Admiral Portfolio (ECAP), has jumped 28.8% over the past 12 weeks. Accenture plc ACN has followed Oracle with 23.5% returns.
ECAP, which consists of 30 concentrated, ultra-defensive, long-term Buy and Hold stocks, returned 3.7% in Q1 2023 versus 7.5% for the S&P 500 Index. The portfolio returned negative 4.7% in 2022 versus the S&P 500 Index’s 18% decline.
With little to no turnover and annual rebalance periodicity, the ECAP seeks to minimize capital loss by holding shares of companies whose earnings streams exhibit a proven 20+ year track record of surviving recessionary periods with minimal impact on aggregate earnings growth relative to the overall S&P 500.
The ECAP and many other model portfolios are available as part of Zacks Advisor Tools, a cloud-based solution to access Zacks award-winning stock, mutual fund and ETF research. Click here to schedule a demo.
Zacks ECDP Stocks Medtronic and Hormel Foods Outperform Peers
Medtronic plc MDT, which is part of our Earnings Certain Dividend Portfolio (ECDP), has returned 7% over the past 12 weeks. Another ECDP stock, Hormel Foods Corporation HRL, has climbed 6.6% over the same time frame. Of course, the inclination of investors toward quality dividend stocks to secure an income stream amid the heightened market volatility contributed to this performance.
Check Medtronic’s dividend history here>>>
Check Hormel Foods’ dividend history here>>>
With an extremely low Beta and a history of minimum earnings variability over the last 20+ years, this 25-stock portfolio helps significantly mitigate risk.
ECDP returned 0.04% in Q1 2023 versus 7.5% for the S&P 500 Index and 1.4% for the ProShares S&P 500 Dividend Aristocrats ETF NOBL. The portfolio returned negative 2.3% in 2022 versus an 18% decline for the S&P 500 Index and an 8.3% loss for NOBL.
Click here to access this portfolio on Zacks Advisor Tools.
Hubbell Makes It Into The Zacks Top 10 Stocks
Hubbell Incorporated HUBB, from the Zacks Top 10 Stocks for 2023, has gained 30.8% year to date, which compares to a 12.8% gain for the S&P 500 Index.
The portfolio returned 5.2% in Q1 2023 versus 7.5% for the S&P 500 (the equal-weighted index, a more appropriate benchmark, returned 2.7 % in Q1). The portfolio returned a negative 15.8% in 2022 versus an 18.1% decline for the S&P 500 Index. Since 2012, the Top 10 portfolio has generated an annualized return of 22.4% versus 12.5% for the S&P 500 Index.
Since the start of 2012, the Zacks Top 10 Stocks delivered a cumulative return of 827.6% through the end of 2022 versus a 265% cumulative return for the S&P 500 Index.
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Accenture PLC (ACN) : Free Stock Analysis Report
Medtronic PLC (MDT) : Free Stock Analysis Report
Oracle Corporation (ORCL) : Free Stock Analysis Report
Adobe Inc. (ADBE) : Free Stock Analysis Report
Hormel Foods Corporation (HRL) : Free Stock Analysis Report
Universal Stainless & Alloy Products, Inc. (USAP) : Free Stock Analysis Report
ADMA Biologics Inc (ADMA) : Free Stock Analysis Report
Hubbell Inc (HUBB) : Free Stock Analysis Report
ProShares S&P 500 Dividend Aristocrats ETF (NOBL): ETF Research Reports
VirTra, Inc. (VTSI) : Free Stock Analysis Report
Iterum Therapeutics PLC (ITRM) : Free Stock Analysis Report
Uber Technologies, Inc. (UBER) : Free Stock Analysis Report
