With the recent bullish activity in the market, numerous stocks, including industry darlings like Amazon AMZN, Arista Networks ANET, and Abercrombie & Fitch ANF, are approaching or surpassing their 52-week highs.
If you’re eager to harness this force, all three of these stocks carry a favorable Zacks Rank, denoting upward adjustments in earnings estimates among analysts. Let’s dig into each one to understand and capitalize on their strength.
Amazon: A Titan in the Market
Amazon shares have been stellar performers, boasting notable outperformance compared to the general market. Currently designated as a Zacks Rank #1 (Strong Buy), the stock is experiencing an upward trajectory in earnings expectations.
Image Source: Zacks Investment Research
Significantly, the company is anticipated to revive its high-growth pattern in its present fiscal year, with consensus estimates predicting a phenomenal 280% growth in earnings on 11% higher sales. The company’s reduced costs have been a pivotal driver of its market dominance. Remarkably, the shares are currently not overly priced, trading at a 2.5X forward price-to-sales ratio, well below its 3.1X median of the last five years and its peak of 4.8X in 2020.
Image Source: Zacks Investment Research
Arista Networks: Riding the AI Wave
Arista Networks has significantly benefitted from the artificial intelligence frenzy. The company supplies network switches to hyperscalers to facilitate faster communication between computer servers.
Similarly holding a Zacks Rank #2 (Buy), Arista Networks has seen a robust upward trend in earnings estimates for its current fiscal year, with estimates soaring 25% to $6.55 per share over the past year.
Image Source: Zacks Investment Research
Similar to Amazon, Arista Networks boasts an impressive growth trajectory, with consensus estimates indicating a remarkable 43% earnings growth and a 33% surge in sales for its current fiscal year. The growth momentum is expected to continue in FY24, with estimates hinting at an additional 10% surge in earnings coupled with an 11% increase in revenue.
As investors eagerly await the company’s next quarterly release scheduled for February 12th, the Zacks Consensus EPS estimate of $1.70 suggests a remarkable 20% year-over-year growth and has surged 8% since last October.
The stellar quarterly results have been pivotal in driving the shares higher, as highlighted by the green arrows in the chart below.
Image Source: Zacks Investment Research
Abercrombie & Fitch: A Retail Force to Reckon With
Abercrombie & Fitch, currently a Zacks Rank #1 (Strong Buy), operates as a specialty retailer offering premium, high-quality casual apparel for men, women, and children through an extensive store network. The company has witnessed a surge in earnings expectations across the board.
Image Source: Zacks Investment Research
Similar to Arista Networks, Abercrombie & Fitch has seen its shares propelled by better-than-anticipated quarterly results, exemplified in the chart below. In fact, the company has surpassed the Zacks Consensus EPS Estimate by an average of 700% across its last four releases.
The shares have surged post-earnings in three consecutive releases, as depicted in the chart below.
Image Source: Zacks Investment Research
Closing Thoughts
Momentum has seamlessly carried over into 2024, with numerous stocks breaking their 52-week highs and undoubtedly pleasing investors.
If you’re eyeing these impressive trends, the three stocks mentioned above – Amazon AMZN, Arista Networks ANET, and Abercrombie & Fitch ANF – could prove to be fantastic considerations worth exploring.
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
Abercrombie & Fitch Company (ANF) : Free Stock Analysis Report
Arista Networks, Inc. (ANET) : Free Stock Analysis Report
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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.
