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Zacks.com featured highlights include Constellation Brands, Stryve Foods, Canoo, Fortuna Mining and Qualcomm
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For Immediate Release

Chicago, IL – December 30, 2024 – Stocks in this week’s article are Constellation Brands STZ, Stryve Foods SNAX, Canoo GOEV, Fortuna Mining Corp. FSM and Qualcomm QCOM.

Bet On These 5 Top-Ranked Stocks With Rising P/E

Investors often opt for an approach that focuses on stocks with a low price-to-earnings (P/E) ratio. This strategy is based on the notion that the lower the P/E ratio, the higher the stock value. The reasoning behind this is straightforward — when a stock's current market price does not adequately reflect its higher earnings, it suggests potential for growth.

But there is more to this whole P/E story. Not only stocks with a low P/E, the ones with a rising P/E can also fetch strong returns. In this regard, investors can bet on the likes of Constellation Brands,Stryve Foods,Canoo, Fortuna Mining Corp.  and Qualcomm.

Rising P/E: A Useful Tool

The concept is that as earnings rise, so should the price of a stock. As forecasts for expected earnings come in higher, strong demand for the stock should continue to push up its prices. After all, a stock's P/E gives an indication of how much investors are ready to shell out per dollar of earnings.

Suppose an investor wants to buy a stock with a P/E ratio of 30. This means that he is willing to shell out $30 for only $1 worth of earnings as he expects earnings of the company to rise at a faster pace in the future owing to strong fundamentals.

So, if the P/E of a stock is rising steadily, it means that investors are assured of its inherent strength and expect some strong positives out of it.

Also, studies have revealed that stocks have seen their P/E ratios jump over 100% from their breakout point in the cycle. So, if you can pick stocks early in their breakout cycle, you can end up seeing considerable gains.

These few criteria have narrowed down the universe from over 7,700 stocks to just 50.

Here are five out of the 50 stocks:

Constellation Brands: This Zacks Rank #2  company produces and markets beer, wine and spirits. You can see the complete list of today’s Zacks #1 Rank stocks here.

The average four-quarter earnings surprise of STZ is 5.30%.

Stryve Foods: This Zacks Rank #2 company is an emerging healthy snacking company, which manufactures, markets and sells healthy snacking products.

The average four-quarter earnings surprise of SNAX is 15.71%.

Canoo: This Zacks Rank #2 company is engaged in developing breakthrough electric vehicles with a proprietary and highly versatile EV platform for personal and business use.

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