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How to Pick Stocks in 2020

Tracey Ryniec
  • (0:30) - The Art Of Picking Stocks: Investing For 2020
  • (6:40) - How Do Market Conditions Effect You Decision Making?
  • (14:10) - Understanding The Top Picks: UI & ATR
  • (24:35) - 2020 Stock Portfolio: Value vs Growth
  • (34:20) - Episode Roundup: GNRC, SHOP, VCRA, OHI, HMSY, ULTA
  •                 Podcast@Zacks.com

Welcome to Episode #205 of the Zacks Market Edge Podcast.

Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life.

This week, Tracey is joined by Sheraz Mian, Zacks Director of Research, to talk about how to pick stocks in 2020.

Experts are saying that stock picking is dead. It’s easier, after all, to simply buy an index fund and that’s it.

But Sheraz, who is the editor of the Zacks Top 10 Stocks portfolio, which launches with new stocks every January, believes that individual stock pickers can still be successful.

How to Find Top Stocks

Sheraz starts his search every year by using the Zacks Ranks of #1 (Strong Buy), #2 (Buy) and #3 (Hold) to narrow down the universe of stocks.

Then he takes a deep dive into the fundamentals, especially how the companies fit into his larger theme of that year whether it is AI, biotech innovations, data analytics, payment and financial innovation, transportation inventions etc.

Usually 25 to 30 companies make the cut. In 2018, Shopify SHOP made it to that stage of the process but didn’t make it onto the final list. Why not?

Here are 4 others that did finally make it onto the 2019 list.

Stocks That Made the Cut in 2019

1.       Generac GNRC is the best performer in the 2019 portfolio. The shares are up 97% year-to-date as consumers have been buying back up generators as climate change has played havoc with electricity reliability in several states. This year, the company has been posting record quarterly results.

2.       Ubiquiti Inc. UI has had a volatile year but has still managed to gain 93% year-to-date. Shares saw a big spike after the last earnings report. It trades with a forward P/E of 33.

3.       Aptar Group ATR was added to the Top 10 portfolio in October 2019. The company makes containers for the beauty, drug and food and beverage industries. Shares are up 24% year-to-date. It trades with a forward P/E of 28.6.

4.       Omega Healthcare OHI falls into one of the long-term investing themes of the aging Baby Boomers. Omega is a REIT which specializes in senior care. It pays a dividend, currently yielding 6.4%.

What else should you know about how to pick stocks for 2020?

Listen to this week’s podcast to find out.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Today, See These 5 Potential Home Runs >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Shopify Inc. (SHOP) : Free Stock Analysis Report
 
AptarGroup, Inc. (ATR) : Free Stock Analysis Report
 
Generac Holdlings Inc. (GNRC) : Free Stock Analysis Report
 
Omega Healthcare Investors, Inc. (OHI) : Free Stock Analysis Report
 
Ubiquiti Inc. (UI) : Free Stock Analysis Report
 
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Zacks Investment Research