U.S. stock markets started November, adding more steam to the ongoing rally. The primary reason was the anticipation of Donald Trump becoming the 47th president of the country. On Nov 5, Trump clinched a significant win in the Presidential election. On Nov 6, all three major stock indexes as well as small-cap benchmarks, jumped.
Consequently, several stocks have shown price strength. We have primarily targeted stocks that have recently been on a bull run. Such stocks have a high chance of carrying the momentum forward.
Five such stocks are — ChromaDex Corp. CDXC, Sezzle Inc. SEZL, Interface Inc. TILE, BGC Group Inc. BGC and Corcept Therapeutics Inc. CORT.
If a stock is continuously witnessing an uptrend, there must be a solid reason or it would have probably crashed. So, looking at stocks capable of beating the benchmark that they have set for themselves seems rational.
However, recent price strength alone cannot create magic. Therefore, other relevant parameters are needed to create a successful investment strategy.
Here’s how you should create the screen to shortlist the current as well as the potential winners.
Screening Parameters:
Percentage Change in Price (4 Weeks) greater than zero: This criterion shows that the stock has moved higher in the last four weeks.
Percentage Change Price (12 Weeks) greater than 10: This indicates that the stock has seen momentum over the last three months. This lowers the risk of choosing stocks that may have drawn attention due to the overwhelming performance of the overall market in a very short period.
Zacks Rank 1: No matter whether market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) have a proven history of outperformance. You can see the complete list of today’s Zacks #1 Rank stocks here.
Average Broker Rating 1: This indicates that brokers are also highly hopeful about the stock’s future performance.
Current Price greater than 5: The stocks must all be trading at a minimum of $5.
Current Price/ 52-Week High-Low Range more than 85%: This criterion filters stocks that are trading near their respective 52-week highs. It indicates that these are strong enough in terms of price.
Just these few criteria narrowed down the search from over 7,700 stocks to 18.
Let’s discuss five out of these 18 stocks:
ChromaDex Corp. supply phytochemical reference standards and reference materials, related contract services, and products for the dietary supplement, nutraceutical, food and beverage, functional food, pharmaceutical and cosmetic markets. CDXC’s core business strategy is to use the intellectual property harnessed by its expertise in the area of natural products and in the creation of reference materials to the industry as the basis for providing new and alternative, green, mass marketable products to its customers.
CDXC’s main priority is to create industry-accepted information and provide products and services to every layer of the functional food, pharmaceutical, personal care and dietary supplement markets. ChromaDex markets and sells its products in the United States and Canada. CDXC offers its products through distributors in Europe, South America, Korea, India, Japan, Australia, New Zealand, China, Indonesia, Malaysia, Singapore, Thailand, and Mexico.
The stock price of ChromaDex has soared 115.1% in the past four weeks. The company has expected earnings growth of more than 100% for the current year. The Zacks Consensus Estimate for the current year has improved 100% over the last seven days.
Sezzle Inc. operates as a technology-enabled payments company primarily in the United States and Canada. SEZL provides its proprietary payments solution in-store and at online retail stores that connect consumers with merchants.
SEZL also offers the Sezzle Platform, which provides a payments solution for consumers that extends credit at the point-of-sale, allowing consumers to purchase and receive the ordered merchandise at the time of sale while paying in installments over time.
The stock price of Sezzle has jumped 54.9% in the past four weeks. The company has expected earnings growth of more than 100% for the current year. The Zacks Consensus Estimate for the current year has improved 0.1% over the last 90 days.
Interface Inc. designs, produces, and sells modular carpet products primarily worldwide. TILE operates in two segments, Americas, and Europe, Africa, Asia and Australia. TILE offers modular carpets under the Interface and FLOR brand names, luxury vinyl tiles, carpet tiles under the CQuestGB name for use in commercial interiors, include offices, healthcare facilities, airports, educational and other institutions, hospitality spaces, and retail facilities, as well as residential interiors, and modular resilient flooring products.
TILE also provides carpet replacement, installation, and maintenance services; and rubber flooring under the norament and noraplan brand names, as well as produces and sells an adapted version of its carpet tile for the healthcare facilities market.
The stock price of Interface has climbed 33.2% in the past four weeks. It has an expected earnings growth rate of 37% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 7% over the last seven days.
BGC Group Inc. operates as a financial brokerage and technology company in the United States and internationally. BGC offers various brokerage products, such as fixed income, such as government bonds, corporate bonds, and other debt instruments, as well as related interest rate derivatives and credit derivatives, equities, energy and commodities, shipping, insurance, and futures and options.
BGC also provides trade execution, connectivity solutions, brokerage services, clearing, trade compression and other post-trade services, information, and other back-office services to an assortment of financial and non-financial institutions. In addition, BGC offers electronic and hybrid brokerage, other financial technology solutions, market data and related information services.
The stock price of BGC Group has surged 18.3% in the past four weeks. The company has expected earnings growth of 20.7% for the current year. The Zacks Consensus Estimate for the current year has improved 6.5% over the last seven days.
Corcept Therapeutics Inc. is engaged in the discovery and development of drugs for the treatment of severe endocrinologic, oncologic, metabolic, and neurologic disorders in the United States. CORT offers Korlym tablets medication for the treatment of hyperglycemia secondary to hypercortisolism in adult patients with endogenous Cushing's syndrome, and for those who have type 2 diabetes mellitus or glucose intolerance and have failed surgery or are not candidates for surgery.
CORT is also developing relacorilant, which is in phase III clinical trial for the treatment of Cushing's syndrome, treatment for adrenal cancer and cortisol excess, which is in phase 1b clinical trial, treatment for prostate cancer which is in phase II clinical trial and nab-paclitaxel in combination with relacorilant, which is in phase III clinical trial to treat platinum-resistant ovarian tumors.
The stock price of Corcept Therapeutics has advanced 18.1% in the past four weeks. It has an expected earnings growth rate of 39.4% for the current year. The Zacks Consensus Estimate for current-year earnings improved 10.1% over the last seven days.
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
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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