Chicago, IL – January 31, 2025 – Stocks in this week’s article are ServiceNow, Inc. NOW, Lululemon Athletica Inc. LULU and Amphenol Corp. APH.
ServiceNow & 2 Other Stocks to Buy for Earnings Growth
Study a company's revenues over a period and deduct production costs to find earnings, which is crucial for any organization's survival. Irrespective of whether it is a start-up or a well-known company, earnings growth is the top priority for any organization. This is because if the company doesn't make money, it won't survive.
Earnings are also considered the most important variable influencing share price. However, expectations of earnings play a prominent role.
Nonetheless, stocks such as ServiceNow, Inc., Lululemon Athletica Inc. and Amphenol Corp. are currently exhibiting superb earnings growth.
Earnings Estimates & Share Price Movements
Frequently, we have seen the stock price decline despite earnings growth and a rally in price following an earnings decline. This is largely the result of a company's earnings failing to meet market expectations.
Earnings estimates embody analysts' opinions on factors such as sales growth, product demand, competitive industry environment, profit margins, and cost control. Thus, earnings estimates serve as a valuable tool, while making investment decisions. Earnings estimates also help analysts assess the cash flow to determine the fair value of a firm.
Thus, investors should watch for stocks poised to make a big move. Hence, investors need to buy stocks with historical earnings growth and are seeing a rise in quarterly and annual earnings estimates.
We use that basis to determine our stock selections using Zack's Research Wizard Tool.
The above criteria narrowed the universe of around 7,839 stocks to only 27. Here are the top three stocks:
ServiceNow
ServiceNow offers intelligent workflow automation solutions for digital businesses globally. ServiceNow recently posted fourth-quarter earnings that beat Wall Street expectations. The company's expected earnings growth rate for the current year is 28.6%. Currently, NOW has a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Lululemon Athletica
Lululemon Athletica designs and sells athletic apparel, footwear and accessories for women and men under the Lululemon brand. The company's expected earnings growth rate for the current year is 12.5%. LULU currently has a Zacks Rank #2.
Amphenol
Amphenol designs and manufactures electrical, electronic and fiber optic connectors in the United States, China, and worldwide. The company's expected earnings growth rate for the current year is 19.1%. APH currently has a Zacks Rank #1.
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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/2407014/servicenow-2-other-stocks-to-buy-for-earnings-growth
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