Strong Buy Alerts: AppLovin & 2 More Momentum Stocks for Big Gains

A potential Federal Reserve rate cut, strong retail sales and new progress in the U.S.-China trade talks may help the broader stock market scale upward in the near future. But that doesn’t guarantee that all stocks will gain traction. Instead, it is judicious for investors to apply the Driehaus strategy to select the best momentum stocks. No doubt, it’s a successful investment strategy that helped Richard Driehaus earn a spot on Barron’s All-Century Team. To that end, stocks like AppLovin Corporation APP, Build-A-Bear Workshop, Inc. BBW and Tenet Healthcare Corporation THC have been selected as the momentum picks for the day using the Driehaus strategy. A Detailed Look Into the Driehaus Strategy Regarding the strategy, Driehaus once said: “I would much rather invest in a stock that’s increasing in price and take the risk that it may begin to decline than invest in a stock that’s already in decline and try to guess when it will turn around.” In line with this insight, the American Association of Individual Investors (AAII) considered the percentage 50-day moving average as one of the key criteria before creating a portfolio following Driehaus’ philosophy. It is calculated by dividing the numerator (month-end price minus 50-day moving average of month-end price) by the 50-day moving average of the month-end price. Another momentum indicator — positive relative strength — has also been included in this strategy. A positive percentage 50-day moving average indicates that the stock is trading at a price higher than its 50-day moving average level, indicating an uptrend. Moreover, AAII found that Driehaus primarily focuses on strong earnings growth rates and impressive earnings projections to pick potential outperformers. Companies with a strong history of beating estimates are also given importance in this strategy, which was made to provide better returns over the long term. Screening Parameters Using Research Wizard: To make the strategy more profitable, we have considered only those stocks that have a Zacks Rank #1 (Strong Buy) and a Momentum Score of A or B. Our research shows that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best upside potential. • Zacks Rank equal to #1 Whether the market is good or bad, stocks with a Zacks Rank #1 have a proven history of outperformance. You can see the complete list of today’s Zacks #1 Rank stocks here. • Last 5-year average EPS growth rates above 2%Strong EPS growth history ensures an improving business • Trailing 12-month EPS growth greater than 0 and industry median Higher EPS growth compared to the industry average indicates superior earnings performance • Last four-quarter average EPS surprise greater than 5%Solid EPS surprise history indicates better price performance • Positive percentage change in 50-day moving average and relative strength over 4 weeksPositive percentage change in the 50-day moving average and relative strength signal uptrend • Momentum Score equal to or less than BA favorable momentum score indicates that it is ideal for taking advantage of the momentum with the highest probability of success. These few parameters have narrowed the universe of over 7,743 stocks to only 19. Here are three of the 19 stocks: AppLovin AppLovin is involved in developing a software platform that helps advertisers optimize marketing and monetize content worldwide. Its operations are divided into two core segments: Advertising and Apps. APP has a Momentum Score of B. The trailing four-quarter earnings surprise for APP is 22.4%, on average. Build-A-Bear Workshop Build-A-Bear Workshop is a multi-channel retailer of plush animals and associated products in the United States and globally. BBW has a Momentum Score of B. The trailing four-quarter earnings surprise for BBW is 21.3%, on average. Tenet Healthcare  Diversified healthcare services company, Tenet Healthcare, has a Momentum Score of B. This U.S.-based company’s four-quarter earnings surprise is 31.2%, on average. You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.Click here to sign up for a free trial to the Research Wizard today.Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. Disclosure: Performance information for Zacks’ portfolios and strategies are available at: https://www.zacks.com/performance.  Radical New Technology Could Hand Investors Huge GainsQuantum Computing is the next technological revolution, and it could be even more advanced than AI.While some believed the technology was years away, it is already present and moving fast. Large hyperscalers, such as Microsoft, Google, Amazon, Oracle, and even Meta and Tesla, are scrambling to integrate quantum computing into their infrastructure.Senior Stock Strategist Kevin Cook reveals 7 carefully selected stocks poised to dominate the quantum computing landscape in his report, Beyond AI: The Quantum Leap in Computing Power.Kevin was among the early experts who recognized NVIDIA's enormous potential back in 2016. Now, he has keyed in on what could be "the next big thing" in quantum computing supremacy. Today, you have a rare chance to position your portfolio at the forefront of this opportunity.See Top Quantum Stocks Now >>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 Tenet Healthcare Corporation (THC): Free Stock Analysis Report Build-A-Bear Workshop, Inc. (BBW): Free Stock Analysis Report AppLovin Corporation (APP): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks