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Three Stocks to Watch as December Heats Up

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Well, we survived November, folks! Stocks exploded like fireworks in celebration, with the S&P 500 rising a sizzling +8% and the Nasdaq climbing an astonishing +10%. Keep those shades on, investors, because December is looking bright, and weโ€™ve got three blazing hot stocks to keep things toasty as we head into the holiday season. Want to know which stocks are ready to light the fire? Grab your marshmallows, because weโ€™re about to heat things up!

Science Applications International: The Burning Bright Star of Value

First up, we have Science Applications International (SAIC). This sizzling tech stock is charging ahead as it gears up to release its third-quarter results on Monday, December 4. This leading information technology (IT) and professional services provider is sparking some serious interest, especially with the Zacks Computers-IT Services Industry clinching a spot in the top 24% of over 250 Zacks industries.

Despite forecasts of a -12% dip in Q3 earnings to $1.66 per share, Science Applications is set to sizzle even brighter. The Zacks ESP (Expected Surprise Prediction) is predicting that the company could surpass expectations, with the Most Accurate Estimate pointing to a Q3 EPS of $1.71 per share โ€“ a scorching 3% higher than the Zacks Consensus. And talk about value โ€“ this incandescent stock boasts an โ€œAโ€ Zacks Style Scores grade for Value and is trading at a mere 15.7X forward earnings. Thatโ€™s hot enough to make any investor break a sweat, especially with the industry average at 24.8X and the S&P 500โ€™s at 21.3X.

Ollieโ€™s Bargain Outlet: Fueling the Growth Fire

Next in the lineup is Ollieโ€™s Bargain Outlet (OLLI), a stock thatโ€™s been stoking the flames of growth and making its mark as a value retailer of brand-name merchandise. Scheduled to report its scorching Q3 results on Wednesday, December 6, Ollieโ€™s is expected to set the heat record with a projected 19% year-over-year earnings increase to $0.44 per share, and a forecasted 12% surge in sales to $469.95 million.

With double-digit percentage growth on both its top and bottom lines in its current fiscal year and the next, Ollieโ€™s stock is firing on all cylinders. Sporting an โ€œAโ€ Zacks Style Scores grade for Growth, this stock has already scorched +56% in 2023. And after a slight -6% dip in November, this stock could be gearing up for a fiery rebound after a healthy correction.

The Duckhorn Portfolio: A Vintage Treasure Waiting to Ignite

Last but certainly not least, we have The Duckhorn Portfolio (NAPA), the premier producer of wines in North America. As we gear up for its fiscal first-quarter earnings report on Thursday, this vintage stock is starting to simmer, offering a tantalizing buying opportunity after dropping -31% this year and declining -1% in November.

While Q1 earnings are predicted to come in at $0.15 per share, a slight decrease from the prior year quarterโ€™s $0.18 per share, Duckhornโ€™s bottom line is still expected to heat things up with a 3% expansion in its current FY24 and a further scorching 10% jump in FY25 to $0.76 per share. At just 14.6X forward earnings and priced much below the benchmarkโ€™s P/E average and the Zacks Beverage-Alcohol Marketโ€™s 20.2X, the embers of NAPA shares might just be ready to burst into flames.

Bottom Line: Stocks Set to Ignite

And there you have it, folks โ€“ Science Applications International, Ollieโ€™s Bargain Outlet, and The Duckhorn Portfolio are all firing on all cylinders with a Zacks Rank #2 (Buy). Keep your fire extinguishers handy because these stocks could set the market ablaze if they reach or exceed earnings expectations next week. With December kicking into high gear, letโ€™s keep our eyes glued to these three stocks that are ready to turn up the heat!

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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.

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