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Zacks.com featured highlights include East West Bancorp, Automatic Data Processing, CDW, and Qualcomm

·6 min read

For Immediate Release

Chicago, IL – April 5, 2022 – Stocks in this week’s article are East West Bancorp EWBC, Automatic Data Processing ADP, CDW Corp. CDW, and Qualcomm QCOM

4 GARP Stocks to Scoop Up for Maximum Returns

Growth at a reasonable price, or GARP, is an excellent strategy to earn quick profits out of investments. The GARP approach leads to the identification of stocks that are priced below the market or any reasonable target determined by fundamental analysis.

Further, the strategy helps investors in gaining exposure to stocks that have impressive prospects and are trading at a discount. GARP stocks also have solid prospects in terms of cash flow, revenues, earnings per share (EPS) and so on.

That means a portfolio created on the basis of GARP strategy is expected to have stocks that offer the best of both value and growth investing.

GARP Metrics – Mix of Growth & Value Metrics

The GARP strategy seeks to offer an ideal investment by utilizing the best features of both value and growth investing. Investors adopting the GARP approach will prefer to buy stocks that are priced below the market or any reasonable target determined by fundamental analysis. These stocks also have solid prospects in cash flow, revenues, earnings per share (EPS) and so on.

Growth Metrics

Both strong earnings growth history and impressive earnings prospects are the main concepts that GARP investors borrow from the growth investing strategy. However, instead of super-normal growth rates, pursuing stocks with a more stable and reasonable growth rate is also a tactic of GARP investors. Hence, growth rates between 10% and 20% are considered ideal under the GARP strategy.

Another growth metric that is considered by both growth and GARP investors is return on equity (ROE). GARP investors look for strong and higher ROE compared to the industry average to identify superior stocks. Moreover, stocks with positive cash flow find precedence under the GARP plan.

Value Metrics

GARP investing gives priority to one of the popular value metrics – price-to-earnings (P/E) ratio. Though this investing style picks stocks with higher P/E ratios compared to value investors, it avoids companies with extremely high P/E ratios. Moreover, the price-to-book value (P/B) ratio is also considered.

Using the GARP principle, we have run a screen to identify stocks that should offer solid returns in the near term.

Here are four stocks that made it through the screen:

East West Bancorp serves as a financial bridge between the United States and Greater China by providing various personal and commercial banking services to small and medium-sized businesses, business executives, professionals, and other individuals. The company currently carries a Zacks Rank #2. You can see the complete list of today's Zacks #1 Rank stocks here.

East West Bancorp has a trailing four-quarter earnings surprise of 8.39%, on average. The stock has gained 5.4% over a year.

Automatic Data Processing is a provider of cloud-based Human Capital Management technology solutions, including payroll, talent management, Human Resources and benefits administration, and time and attendance management. The company carries a Zacks Rank #2.

Automatic Data Processing has a trailing four-quarter earnings surprise of 5.5%, on average. The stock has appreciated 20.9% over a year.

CDW Corp. is a leading provider of integrated information technology (IT) solutions to small, medium and large business, government, education and healthcare customers. The company carries a Zacks Rank #2 currently.

CDW has a trailing four-quarter earnings surprise of 9.8%, on average. The stock has increased 3.7% over a year.

Qualcomm designs, manufactures and markets digital wireless telecom products and services based on the Code Division Multiple Access technology. The company carries a Zacks Rank #2 currently.

Qualcomm has a trailing four-quarter earnings surprise of 12.22%, on average. The stock has climbed 4.7% over a year.

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For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/1892093/4-garp-stocks-to-scoop-up-for-maximum-returns

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.

About Screen of the Week

Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine.  But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.

Strong Stocks that Should Be in the News

Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.


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QUALCOMM Incorporated (QCOM) : Free Stock Analysis Report
 
Automatic Data Processing, Inc. (ADP) : Free Stock Analysis Report
 
East West Bancorp, Inc. (EWBC) : Free Stock Analysis Report
 
CDW Corporation (CDW) : Free Stock Analysis Report
 
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