Unlocking Investment Potential: How Zacks Premium Can Enhance Your Portfolio
New and seasoned investors alike aim to make informed financial decisions. Zacks Premium offers various resources to assist in achieving those goals.
This respected research service empowers users to become more confident investors. It provides daily updates on the Zacks Rank and Zacks Industry Rank, the Zacks #1 Rank List, Equity Research reports, and Premium stock screens.
Understanding Zacks Style Scores
Pioneered alongside the Zacks Rank, the Zacks Style Scores are essential tools for identifying stocks that are likely to outperform the market over the next month. Stocks receive ratings from A to F based on their value, growth, and momentum characteristics. Similar to school grades, higher scores suggest a better chance of success.
The Style Scores fall into four categories:
Value Score
Value investors seek stocks priced below their true worth. The Value Style Score analyzes financial ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to identify these investment opportunities.
Growth Score
Focused on long-term viability, growth investors look for companies with robust financial health and promising futures. The Growth Style Score examines projected and historical metrics such as earnings, sales, and cash flow.
Momentum Score
This strategy emphasizes trends in stock prices. Momentum investors leverage the “trend is your friend” principle. The Momentum Style Score determines the best times to invest in stocks by analyzing short-term price changes and earnings estimate revisions.
VGM Score
This score combines all three investment styles into one. The VGM Score evaluates companies based on their value, growth potential, and momentum, making it a valuable companion to the Zacks Rank.
How Style Scores Complement the Zacks Rank
The Zacks Rank is a proprietary stock-rating model that simplifies the portfolio-building process by focusing on earnings estimate revisions. Historically, stocks ranked #1 (Strong Buy) have delivered an impressive average annual return of +25.41% since 1988, outperforming the S&P 500.
With over 800 stocks rated highly, selecting the right ones can seem daunting. That’s where Style Scores become crucial.
To maximize success, it’s essential to choose stocks with a Zacks Rank of #1 or #2 and Style Scores of A or B. A stock with a #3 (Hold) rank can still be valuable if it boasts solid Style Scores.
Monitoring the direction of earnings estimate revisions is key. Stocks rated #4 (Sell) or #5 (Strong Sell) may have high Style Scores but are likely to see their value decline.
Spotlight on Meta Platforms (META)
Meta Platforms stands out as the world’s largest social media entity. Originally starting as Facebook, it has expanded into a family of apps, including Instagram and WhatsApp, due to strategic acquisitions. As of March 31, 2024, nearly 3.24 billion users engage with Meta’s products daily.
Currently, META is rated #3 (Hold) in the Zacks Rank, with a VGM Score of B. It stands as a promising option for growth investors, projecting a year-over-year earnings increase of 52.5% for this fiscal year.
In the last two months, 19 analysts raised their earnings estimates for fiscal 2024, pushing the Zacks Consensus Estimate up by $1.21 to $22.68 per share. Additionally, the company has recorded an average earnings surprise of 11.3%.
Given its strong Zacks Rank and impressive Growth and VGM Style Scores, META should be a key consideration for investors.
Discover Zacks’ Top 10 Stocks for 2025
Are you looking for early insights into our top stock picks for 2025?
Historical data indicates that these selections have performed exceptionally well. From 2012, when Research Director Sheraz Mian took over the portfolio, the Zacks Top 10 Stocks appreciated +2,112.6%, significantly outpacing the S&P 500’s +475.6% return. Sheraz is currently evaluating 4,400 companies to identify the best 10 stocks to buy and hold in 2025. Be prepared to seize these opportunities when they are revealed on January 2.
Interested in the latest recommendations from Zacks Investment Research? You can also download 5 Stocks Set to Double for free.
For a detailed analysis of Meta Platforms, Inc. (META), click here.
Zacks Investment Research
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
