Chicago, IL – April 3, 2025 – Stocks in this week’s article are EMX Royalty Corp. EMX, DNOW Inc. DNOW and EZCORP, Inc. EZPW.
3 of the Best Breakout Stocks to Buy Now
An active investing approach is when you look for breakout stocks within a specific price range. Sell if the price drops below the lower band and hold for gains if it surpasses the upper band.
To that end, EMX Royalty Corp., DNOW Inc. and EZCORP, Inc. have been selected as today's breakout stocks.
Zeroing in on Breakout Stocks
To pick a breakout stock, calculate support and resistance levels. A support level is the lower bound for stock movements, while a resistance level refers to the maximum price it trades at within a considerable period.
In other words, the demand for a stock is at its lowest at its support level, which means that most traders are willing to sell it. Most traders are willing to go long on the stock at the resistance level, meaning they would like to add it to their portfolio. The key to identifying breakout stocks is to zero in on those on the verge of a breakout or those that have just broken above the resistance level.
Has a Genuine Breakout Occurred?
The primary risk associated with such a strategy is that the decision to buy an apparent breakout candidate has been incorrectly timed. When a stock moves above the resistance level, it should be a highly prized commodity for traders. However, whether such a breakout is genuine is another matter altogether.
For a bona fide breakout, the stock's earlier resistance barrier should become its new support level. This only happens if the established trading channel is tested by observing long-term price trends. The strength of the support and resistance levels can be ascertained only through such a study. Despite the risk of misidentification, correctly identifying such stocks can yield considerable returns, even at a price that may not seem attractive at first glance.
These criteria narrow the universe of more than 6,853 stocks to only six. Here are the top three stocks:
EMX Royalty Corporation explores and generates royalties from metal and mineral properties. EMX Royalty has an expected earnings growth rate of 200% for the current year.
DNOW Inc. distributes energy and industrial products globally for sectors such as petroleum refining, chemical processing and power generation. The expected earnings growth rate of DNOW for next year is 18.6%.
EZCORP, Inc. provides pawn services in the United States and Latin America. EZPW has an expected earnings growth rate of 17.9% for the current year.
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