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Find Great Stocks Trading Near Highs During Market Turbulence

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Stocks fell to start the holiday-shortened week, as Wall Street assesses escalating tensions between Russia and Ukraine. Investors are increasingly worried about the potential geopolitical and economic fallout from what might happen next.

The unknowns have spooked Wall Street, with the S&P 500 trading at its lowest point in 2022 through morning trading Tuesday, down roughly 11% off its records. The benchmark is trading well below its 200-day moving average once again as the S&P 500 enters correction territory for the second time. The tech-heavy Nasdaq is under pressure again, with it trading right back at its lows (down around 18%) as investors continue to shy away from all things growth.

Geopolitics aside, Wall Street is still trying to figure out what the Fed is going to do at its mid-March meeting. Investors are increasingly convinced the Fed will raise rates by 0.50% (not 0.25%) to start combating rising prices. The higher rates are arguably more important to the market than Russia and there could be increased volatility and choppiness until the Fed actually makes a definitive move and provides more clarity.

On the bright side, the market has been preparing for higher rates for a long time now. And the outlook for S&P 500 earnings, revenue, and margins is rather impressive, all things considered (also read: Record Earnings in Q4 Despite Economic Headwinds).

Despite all the legitimate reasons for worry and the overall market downturn, some stocks and industries have thrived in the first two months of 2022. Investors who decide to stay exposed to stocks might want to consider buying names that are trading at or near their highs amid all the turmoil…

Don't Be Afraid of New Highs

Some investors might prefer not to buy stocks at new highs. But if somebody asked you what the best stocks in your portfolio are, it’s likely you would name the stocks moving up the most.

The most basic idea is that the winners in your portfolio are the ones going up. If a stock is underperforming the market or going down, you'll quickly identify it as one of your worst holdings. Therefore, it makes sense that some of these stocks will be reaching new highs along the way.

Many investors are hesitant to buy stocks making new 52-week highs. But there really isn’t any reason to be. Some may worry that they have already missed the mark at that point, or that now it has more room to fall. Still, a stock making a new 52-week high is a ‘good thing,’ just as one falling to a new 52-week low is a ‘bad thing.’

On top of that, would the person who doesn’t want to buy stocks making new highs be upset if a stock they owned broke out to a new 52-week high? Statistics have also shown that stocks making new highs have a tendency of making even higher highs. And aren’t these the stocks we all dream about?

Now obviously, the fundamentals need to be there, and you should try to keep an eye on valuations. But if you were in a stock making new highs and cheering it on, it seems odd to be afraid of one doing the same just because you haven't bought it yet.

Think about this: A stock just made a new-52 week high, which is great news. Guess what? Last year it made a new 52-week high as well. And the year before that. And the year before that. Can you imagine all the money you'd be leaving on the table if you were afraid of being in stocks every time they made a new high?

Parameters

• Current Price/52-Week High greater than or equal to .80

• Percent Change in Price over 12 Weeks greater than 0

• Percent Change in Price over 4 Weeks greater than 0

• Zacks Rank equal to 1

• Price/Sales Ratio less than or equal to Industry Median

• P/E (using F1 Estimates) less than or equal to Industry Median

• Projected One Year EPS Growth F(1)/F(0) greater than or equal to Industry Median

• Current Avg. 20-Day Volume greater than Previous Week's Avg. 20-Day Volume

• All of the above parameters are applied to stocks with a Price greater than or equal to $5 and an Average 20-Day Volume of greater than or equal to 100,000 shares.

• Percent Change in Price over 12 Weeks + Percent Change in Price over 4 Weeks equal to Top # 5

Here are two of the five stocks that made it through today’s screen…

Marathon Oil Corporation MRO

Marathon Oil Corporation is an independent exploration and production company with a multi-basin portfolio in the U.S., alongside exposure in Equatorial Guinea. MRO’s portfolio aims to be approximately 50% oil and 50% gas/ Natural gas liquids. Marathon is coming off a strong year and it topped our fourth quarter earnings estimates on February 16.

Marathon has raised its dividend payout recently and it’s continued to buy back its own shares. The company has found success amid rising oil prices and a quick rebound in energy demand from the initial covid lows. MRO’s outlook for 2022 appears strong and its consensus earnings outlook has improved since its report. Plus, Marathon has crushed our EPS estimates in the trailing four quarters. And Marathon shares have surged 90% in the last year and 31% in 2022.

Titan International TWI

Titan International is a leading global manufacturer of off-highway wheels, tires, assemblies, and undercarriage products. Titan International produces a broad range of products to meet the specifications of original equipment manufacturers and aftermarket customers in the agricultural, earthmoving/construction, and consumer markets.

Titan International is part of the Zacks Manufacturing-Farm Equipment space that ranks in the top 19% of over 250 of our industries at the moment. TWI’s top and bottom-line growth outlook appears strong and it lands an overall “A” VGM grade at the moment. Titan International shares have climbed over 40% in the last three months vs. the S&P 500’s 8% decline and its industry’s 6% jump.

Get the rest of the stocks on this list and start looking for the newest companies that fit these criteria. It's easy to do. And it could help you find your next big winner. Start screening for these companies today with a free trial to the Research Wizard. You can do it.

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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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