Revolutionizing Stock Selection
Stocks with rising earnings estimates have significantly outperformed the S&P 500 year after year, whereas stocks with falling earnings estimates have underperformed the S&P 500 year after year. Enter the Zacks Rank. The Zacks Rank has made the process of identifying stocks with changing earnings estimates easy and very profitable, acting as a reliable tool that instills confidence in traders regardless of their preferred trading style or risk tolerance.
The Power of Zacks Rank in Action
The Zacks Rank employs four factors related to earnings estimates to categorize stocks into five groups, ranging from ‘Strong Buy’ to ‘Strong Sell,’ allowing individual investors to capitalize on trends in earnings estimate revisions, leveraging the expertise of institutional investors.
NVIDIA: Riding the AI Wave
Amidst the AI frenzy, NVIDIA has soared with the tide of earnings estimate revisions, reclaiming a Zacks Rank #1 (Strong Buy) status on Feb 23rd. The stock has surged by nearly 15% since then, buoyed by record Q4 revenue of $22.1 billion, marking a staggering 409% increase YoY, predominantly fueled by soaring demand for AI chips.
Image Source: Zacks Investment Research
Progressive: Sailing on Positive Earnings
Progressive has reaped the benefits of consistently outperforming quarterly results, witnessing a 15% surge since ascending to a Zacks Rank #1 (Strong Buy). The stock remains an attractive option for growth-focused investors, with optimistic consensus views for both FY24 and FY25, projecting substantial earnings growth alongside increased sales.
Image Source: Zacks Investment Research
HCA Healthcare: Healthy Earnings Outlook
HCA Healthcare has encountered favorable earnings estimate revisions across various periods, elevating the stock to a Zacks Rank #1 (Strong Buy) on Feb 9th, subsequently gaining 9% in value since. The company not only boasts a shareholder-friendly disposition with a reasonable dividend yield and growth rate but also reflects a sustainable payout ratio of 13% of earnings.
Image Source: Zacks Investment Research
Unleashing Market-Beating Potential
As showcased by the stellar performance of NVIDIA, Progressive, and HCA Healthcare, adherence to the Zacks Rank consistently yields market-beating gains. These three stocks—all currently adorned with a Zacks Rank #1 (Strong Buy)—stand as testaments to the rewarding nature of following positive earnings estimate revisions.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
