Yahoo Finance Zacks.com featured highlights Abercrombie & Fitch, Tenet Healthcare and PDD Holdings
For Immediate Release
Chicago, IL – June 25, 2024 – Stocks in this week’s article are Abercrombie & Fitch Co. ANF, Tenet Healthcare Corp. THC and PDD Holdings Inc. PDD.
Buy 3 Momentum Anomaly Stocks as Markets Sway on A.I. Boom
Over the past few trading days, the broader U.S. equity market witnessed a roller-coaster ride due to a topsy-turvy tech-infused rally led by AI-chip manufacturer Nvidia. With investors betting big on the AI boom on solid demand trends, the market observed an erratic pattern as it swayed with Nvidia’s ups and downs.
The market was also exposed to a mix of contrasting news that triggered a cyclical motif. While it was buoyed by healthy labor market conditions and the Federal Reserve’s decision to keep interest rates unchanged, the Fed’s decision to cut rates only once this year, contrary to an earlier pledge to cut the same thrice in 2024, spurred a downtrend.
Amid the uncertainty, investors often seek to employ time-tested winning strategies to fetch sustained profits. One of the most successful game plans to beat the blues is to bet on momentum stocks when value or growth investing fails to generate the desired profits.
This approach primarily tends to follow the adage, “the trend is your friend.” At its core, momentum investing is “buying high and selling higher.” It is based on the idea that once a stock establishes a trend, it is more likely to continue in that direction because of the momentum that is already behind it.
Momentum investing is a way to profit from the general human tendency to extrapolate current trends into the future. It is based on that gap in time before the mean reversion occurs, i.e., before prices become rational again.
In this context, stocks like Abercrombie & Fitch Co., Tenet Healthcare Corp. and PDD Holdings Inc. are worth betting on.
Momentum strategies have been known to be alpha-generative over a long period and across market stages. So, this strategy is quite tricky to implement, as detecting these trends is no child’s play.
Here, we have created a strategy to help investors get in on these fast movers and rake in handsome gains. Our screen will help you benefit from both long-term price momentum and a short-term pullback in price.
Here are three stocks out of the four that made it through this screen:
Headquartered in New Albany, OH, Abercrombie operates as a specialty retailer of premium, high-quality casual apparel for men, women and kids through a network of approximately 759 stores across North America, Europe, Asia and the Middle East, as well as the e-commerce sites. Abercrombie's product portfolio includes knit and woven shirts, graphic T-shirts, fleece, jeans and woven pants, shorts, sweaters, outerwear, personal care products and accessories for men, women and kids, under the Abercrombie & Fitch, Abercrombie kids and Hollister brands. The stock has surged 369.3% in the past year but declined 6.2% in the past week. Abercrombie has a Momentum Score of A.
Headquartered in Dallas, TX, Tenet Healthcare is an investor-owned healthcare services company that owns and operates general hospitals and related healthcare facilities for urban and rural communities in numerous states and has offices in California and Florida. The company has investments in other healthcare companies and is one of the largest investor-owned healthcare delivery systems in the United States. The stock has gained 70.8% in the past year but declined 2.7% in the past week. Tenet Healthcare has a Momentum Score of A.
Based in Dublin, Ireland, PDD Holdings owns and operates a portfolio of businesses. It operates Pinduoduo, an e-commerce platform that offers products in various categories, including agricultural produce, apparel, shoes, bags, mother and childcare products, food and beverage, electronic appliances, furniture and household goods, cosmetics and other personal care, sports and fitness items and auto accessories; and Temu, an online marketplace. The stock has rallied 106.8% in the past year but lost 3.4% in the past week. PDD Holdings has a Momentum Score of A.
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For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2292233/buy-3-momentum-anomaly-stocks-as-markets-sway-on-ai-boom
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Abercrombie & Fitch Company (ANF) : Free Stock Analysis Report
Tenet Healthcare Corporation (THC) : Free Stock Analysis Report
PDD Holdings Inc. Sponsored ADR (PDD) : Free Stock Analysis Report
