Chicago, IL – November 20, 2024 – Stocks in this week’s article are Doximity, Inc. DOCS, Impinj, Inc. PI and Innodata Inc. INOD.
3 Momentum Anomaly Stocks to Buy as Election Rally Fizzles
The broader U.S. equity markets have witnessed significant volatility over the past few trading days as the post-election rally fizzled due to concerns regarding potential policy shifts under the new administration. The markets were further weighed down by apprehensions about the pace of interest rate cuts as healthy economic growth offered some leeway to go slow on the proposed monetary easing. However, solid earnings from blue-chip technology stocks helped markets recover some lost ground.
With NVIDIA results around the corner, markets remained upbeat as experts anticipate robust demand trends for its Blackwell AI (artificial intelligence) chips. Amid the uncertainty, investors often seek to employ time-tested winning strategies to fetch sustained profits. One of the most successful game plans to beat the blues is to bet on momentum stocks like Doximity, Inc., Impinj, Inc. and Innodata Inc. when value or growth investing fails to generate the desired profits.
This approach primarily tends to follow the adage, “the trend is your friend.” At its core, momentum investing is “buying high and selling higher.” It is based on the idea that once a stock establishes a trend, it is more likely to continue in that direction because of the momentum that is already behind it. Momentum investing is a way to profit from the general human tendency to extrapolate current trends into the future. It is based on that gap in time before the mean reversion occurs, i.e., before prices become rational again.
Momentum strategies have been known to be alpha-generative over a long period and across market stages. So, this strategy is quite tricky to implement, as detecting these trends is no child’s play. Here, we have created a strategy to help investors get in on these fast movers and rake in handsome gains. Our screen will help you benefit from both long-term price momentum and a short-term pullback in price.
Here are three stocks out of eight that made it through this screen:
Headquartered in San Francisco, CA, Doximity operates a cloud-based digital platform for medical professionals in the United States. The company offers digital tools for medicine that enable members to collaborate with colleagues, stay up to date about the latest medical news and research, streamline documentation and administrative paperwork, and conduct virtual patient visits. The stock has surged 113.8% in the past year but declined 14.8% in the past week. Doximity has a Momentum Score of A.
Headquartered in Seattle, WA, Impinj operates a cloud connectivity platform that wirelessly connects items and delivers data about the connected items to business and consumer applications. The company's platform comprises endpoint ICs, miniature radios-on-a-chip that attach to a host item and include a number to identify the item. The stock has rallied 112.9% in the past year but declined 11.7% in the past week. Impinj has a Momentum Score of B.
Headquartered in Ridgefield Park, NJ, Innodata is a global data engineering firm that helps leading technology companies and enterprises drive Generative AI / AI innovation. It offers a range of transferable solutions, platforms and services for Generative AI / AI builders and adopters. The stock has skyrocketed 380.2% in the past year but declined 9.7% in the past week. Innodata has a Momentum Score of A.
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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/2372020/3-momentum-anomaly-stocks-to-buy-as-election-rally-fizzles
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