In the current volatile markets, a basic fundamental analysis of companies is not enough to zero in on stocks that have the potential to generate solid returns. In such a situation, expert advice helps picking the right stocks. You could simply follow broker rating upgrades, as they have a deeper insight into stocks, the sectors and the overall economy.
Brokers directly communicate with the top management. They also thoroughly study the publicly available documents and attend conference calls.
In addition, brokers scrutinize the fundamentals of companies and place them against the current economic backdrop to find out how the stocks will fare as an investment option. Hence, by following broker rating upgrades, you can easily find attractive stocks.
But solely depending on broker upgrades is not advisable. You must take into consideration a few other factors before adding a stock to your investment portfolio. This way you can ensure steady returns.
Choosing the Winning Strategy
We have a screening strategy that will help you in your search for potential winners:
Broker Rating Upgrades (four weeks) of 1% or more: The screen selects stocks that have witnessed broker rating upgrades of 1% or more over the last four weeks.
Current Price greater than $5: The stocks must be trading above $5.
Average 20-day Volume greater than 100,000: A large trading volume guarantees that the stock is easily tradable.
Zacks Rank equal to #1 or 2: No matter whether market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) or 2 (Buy) have a proven record of success. You can see the complete list of today’s Zacks #1 Rank stocks here.
VGM Score of A or B: Our research shows that stocks with a VGM Score of A or B when combined with a Zacks Rank #1 or 2 offer the best upside potential.
Here are the four of the five stocks that qualified the screening:
Owens & Minor, Inc. OMI operates as a healthcare solutions company. This Richmond, VA-based company’s earnings for 2020 are projected to grow at the rate of 141.1%. The stock, sporting a Zacks Rank #1 at present, has witnessed 25% upward revision in broker ratings over the past four weeks.
Headquartered in Elkhart, IN, LCI Industries LCII manufactures and supplies components for the manufacturers of recreational vehicles (RVs) and adjacent industries. Its earnings for the current year are projected to grow at the rate of 1.4%. The stock, currently sporting a Zacks Rank #1, has witnessed 14.3% upward revision in broker ratings over the past four weeks.
Thor Industries, Inc. THO, the largest manufacturer of RVs in the world, sells the vehicles along with related parts and accessories to independent, non-franchise dealers. This Elkhart, IN-based company’s earnings are projected to increase 75.5% for fiscal 2021. The stock, carrying a Zacks Rank #2 at present, has witnessed 14.3% upward revision in broker ratings over the past four weeks.
Based in Memphis, TN, FedEx Corporation FDX is the leader in global express delivery services. The company’s fiscal 2021 earnings are projected to rise 57.4%. The stock, currently sporting a Zacks Rank #1, has witnessed 4.6% upward revision in broker ratings over the past four weeks.
Get the rest of the stocks on the list and start putting this and other ideas to the test. It can all be done with the Research Wizard stock picking and backtesting software.
The Research Wizard is a great place to begin. It’s easy to use. Everything is in plain language. And it’s very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.
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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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Owens Minor, Inc. (OMI): Free Stock Analysis Report
FedEx Corporation (FDX): Free Stock Analysis Report
Thor Industries, Inc. (THO): Free Stock Analysis Report
LCI Industries (LCII): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.