Kevin Matras shows how to find great growth stocks at an excellent value. Stocks in this week’s article are CNH Global (NYSE: CNH), ArcelorMittal (NYSE: MT), Nucor Corp. (NYSE: NUE), Timken Co. (NYSE: TKR) and Valero Energy Corp. (NYSE: VLO). Click here for the full story exclusively on Zacks.com: http://at.zacks.com/?id=109
Screen of the Week written by Kevin Matras of Zacks Investment Research:
This week's screen has something for both Growth Investors and Value Investors.
Growth Investors focus on companies with great earnings growth, but that alone isn't good enough for many stock pickers any more. With P/Es on the decline, even growth investors are demanding earnings at reasonable prices (i.e., low P/Es).
And while Value Investors focus on low P/E stocks, too many are low because they lack earnings power. With tons of stocks suddenly trading in 'value' type ranges, it's their growth stories that will set them apart.
Nowadays, one without the other just doesn't cut it.
So instead, try combining the best of both worlds and focus on the companies with the highest growth rates and the lowest P/E ratios.
The screen I'm running this week is as follows:
- Companies with 5 Yr. Historical Growth Rates in the top 20 percentile of all companies. (Using a Uniform Rank of 1-99 (99 being the best growth rates), I screened for stocks ranked 80 or better.)
- Companies that also have the lowest P/Es – lower than 80% of all other companies. (Using a Uniform Rank of 1-99 again (this time 99 having the lowest P/Es), I screened for stocks ranked 80 or better.)
- I then required those stocks to be trading at or above $5, with average daily trading volumes of 100,000 shares or more.
- And a Zacks #3 Rank or less. (No 'Sells' or 'Strong Sells' allowed.)
Here are 5 stocks from this week’s list (12/2/08):
|VLO||Valero Energy Corp.|
This screen is an excellent way to find good growth companies that also have low valuations.
Check it out for yourself and get the rest of the stocks on this list. See where your stocks Rank out of all the other stocks out there, and test your own strategies to see how they've done. Find out what works and what doesn't. It can all be done with the Research Wizard stock picking and backtesting program: http://at.zacks.com/?id=111
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.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use. Each week, Zacks Profit from the Pros free email newsletter shares a new screening strategy. Learn more about it here http://at.zacks.com/?id=112
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros http://at.zacks.com/?id=113
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.