Yahoo Finance Take the Zacks Approach to Beat the Market: Shopify, Brambles, McDonald's in Focus
The three most widely followed indexes closed the past week in the green, ending a six-week stretch of mixed results. The Dow Jones Industrial Average advanced 0.4%, while the S&P 500 and the Nasdaq Composite gained 1.7% and 3%, respectively. For the S&P 500 and the Nasdaq Composite, this was the biggest weekly percentage advance since the end of March.
Throughout the week, investors remained hopeful that the debt-ceiling negotiation between the two major political parties would be fruitful, and allow the country to avoid a debt default. Also helping were good retail sales and solid performance by retail giants in their earnings reports for the quarter. However, with negotiations breaking down on Friday, this positive mood dissipated, and the market pared some of the gains it made throughout the week.
Fed chair Jerome Powell, however, signaled that there might be a rate pause in the offing in the next Fed meeting. This has kept investors upbeat about the June FOMC meeting as the market continues to rise and fall on the question of a probable recession.
Regardless of market conditions, we, here at Zacks, provide investors with unbiased guidance on how to beat the market.
As usual, Zacks Research guided investors over the past three months with its time-tested methodologies. Given the prevailing market uncertainty, you may want to look at our feats to prepare better for your next action.
Here are some of our key achievements:
Crawford and General Mills Surge Following Zacks Rank Upgrade
Shares of Crawford & Company (CRD.B) have soared 38.8% (versus the S&P 500’s 6.2% increase) since it was upgraded to a Zacks Rank #1 (Strong Buy) on March 8.
Another stock, General Mills, Inc. GIS, which was upgraded to a Zacks Rank #2 (Buy) on February 20, has returned 14.2% since then (versus the S&P 500’s 3.8% rise).
Zacks Rank, our short-term rating system, has earnings estimate revisions at its core. Empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
This stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally audited track record, with Zacks Rank #1 stocks generating an average annual return of +24.8% since 1988. You can see the complete list of today’s Zacks Rank #1 stocks here >>>
A hypothetical portfolio of Zacks Rank #1 stocks has returned 9.7% this year (through March 6) versus 5.4% for the S&P 500 Index.
Check Crawford’s historical EPS and Sales here>>>
Check General Mills’ historical EPS and Sales here>>>
Zacks Recommendation Upgrade Drives Brambles and Manitowoc Higher
Shares of Brambles Limited BXBLY and The Manitowoc Company, Inc. MTW have advanced 16.3% (versus the S&P 500’s 5.6% rise) and 8.8% (versus the S&P 500’s 3.8% increase), respectively, since their Zacks Recommendation was upgraded to Outperform on February 24 and February 21, respectively.
While the Zacks Rank is our short-term rating system that is most effective over the one- to three-month holding horizon, the Zacks Recommendation aims to predict performance over the next 6 to 12 months. However, just like the Zacks Rank, the foundation for the Zacks Recommendation is trends in earnings estimate revisions.
The Zacks Recommendation classifies stocks into three groups — Outperform, Neutral and Underperform. While these recommendations are determined quantitatively, our analysts have the flexibility to override them for the 1100+ stocks they closely follow based on their better judgment of factors such as valuation, industry conditions and management effectiveness than the quantitative model.
To access our research reports with Zacks Recommendations for the 1100+ stocks we cover, click here>>>
Zacks Focus List Stocks Shopify, Lam Research Soar
Shares of Shopify Inc. SHOP, which belong to the Zacks Focus List, have risen 42.1% over the past 12 weeks. The stock was added to the Focus List on September 6, 2022. Another Focus-List holding, Lam Research Corporation LRCX, which was added to the portfolio on December 5,2016, has returned 21.3% over the past 12 weeks. The S&P 500 has gained 6.8% over this period.
The Zacks Focus List is a model portfolio of 50 hand-picked stocks that possess the right fundamental ingredients to outperform the market over the next 12 months. These 50 stocks are picked from a long list of stocks with the highest Zacks Rank.
The 50-stock Zacks Focus List model portfolio returned 11.1% in 2023 Q1 versus 7.5% for the S&P 500 Index. In 2022, the portfolio produced a 15.2% loss versus the S&P 500 Index’s 18% decline.
Since 1996, the Focus List portfolio has produced an annualized return of 12.9% through March 31, 2023. This compares to an 8.9% annualized return for the S&P 500 Index in the same time period.
Unlock all of our powerful research, tools and analysis, including the Focus List, Zacks #1 Rank List, Equity Research Reports, Zacks Earnings ESP Filter, Premium Screener and more, as part of Zacks Premium. Gain full access now >>
Zacks ECAP Stocks Novo Nordisk and McCormick Make Significant Gains
Novo Nordisk A/S NVO, a component of our Earnings Certain Admiral Portfolio (ECAP), has jumped 19.4% over the past 12 weeks. McCormick & Company, Incorporated MKC has followed Novo Nordisk with 17.9% returns.
ECAP, which consists of 30 concentrated, ultra-defensive, long-term Buy and Hold stocks, returned 3.7% in 2023 Q1 versus 7.5% for the S&P 500 Index. The portfolio returned negative 4.7% in 2022 versus the S&P 500 Index’s 18% decline.
With little to no turnover and annual rebalance periodicity, the ECAP seeks to minimize capital loss by holding shares of companies whose earnings streams exhibit a proven 20+ year track record of surviving recessionary periods with minimal impact on aggregate earnings growth relative to the overall S&P 500.
The ECAP and many other model portfolios are available as part of Zacks Advisor Tools, a cloud-based solution to access Zacks award-winning stock, mutual fund and ETF research. Click here to schedule a demo.
Zacks ECDP Stocks McDonald’s and Hershey’s Outperform Peers
McDonald’s Corporation MCD, which is part of our Earnings Certain Dividend Portfolio (ECDP), has returned 10.8% over the past 12 weeks. Another ECDP stock, The Hershey Company HSY, has climbed 10.6% over the same time frame. Of course, the inclination of investors toward quality dividend stocks to secure an income stream amid the heightened market volatility contributed to this performance.
Check McDonald’s dividend history here>>>
Check Hershey’s dividend history here>>>
With an extremely low Beta and a history of minimum earnings variability over the last 20+ years, this 25-stock portfolio helps significantly mitigate risk.
ECDP returned 0.04% in 2023 Q1 versus 7.5% for the S&P 500 Index and 1.4% for the ProShares S&P 500 Dividend Aristocrats ETF NOBL. The portfolio returned negative 2.3% in 2022 versus an 18% decline for the S&P 500 Index and an 8.3% loss for NOBL.
Click here to access this portfolio on Zacks Advisor Tools.
Hubbell Makes It Into The Zacks Top 10 Stocks
Hubbell Incorporated HUBB, from the Zacks Top 10 Stocks for 2023, has gained 19.3% year to date, which compares to a 9.9% gain for the S&P 500 Index.
The portfolio returned 5.2% in 2023 Q1 versus 7.5% for the S&P 500 (the equal-weighted index, a more appropriate benchmark, returned 2.7 % in Q1). The portfolio returned a negative 15.8% in 2022 versus an 18.1% decline for the S&P 500 Index. Since 2012, the Top 10 portfolio has generated an annualized return of 22.4% versus 12.5% for the S&P 500 Index.
Since the start of 2012, the Zacks Top 10 Stocks delivered a cumulative return of 827.6% through the end of 2022 versus a 265% cumulative return for the S&P 500 Index.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
The Manitowoc Company, Inc. (MTW) : Free Stock Analysis Report
Novo Nordisk A/S (NVO) : Free Stock Analysis Report
McDonald's Corporation (MCD) : Free Stock Analysis Report
Hershey Company (The) (HSY) : Free Stock Analysis Report
General Mills, Inc. (GIS) : Free Stock Analysis Report
Lam Research Corporation (LRCX) : Free Stock Analysis Report
McCormick & Company, Incorporated (MKC) : Free Stock Analysis Report
Crawford & Company (CRD.B) : Free Stock Analysis Report
Shopify Inc. (SHOP) : Free Stock Analysis Report
Hubbell Inc (HUBB) : Free Stock Analysis Report
ProShares S&P 500 Dividend Aristocrats ETF (NOBL): ETF Research Reports
Brambles Ltd. (BXBLY) : Free Stock Analysis Report
