Chicago, IL – August 20, 2018 - Stocks in this week’s article include: Comfort Systems USA, Inc. FIX, Archer Daniels Midland Co. ADM, Insight Enterprises, Inc. NSIT, Fortinet, Inc. FTNT and Avnet, Inc. AVT.
Screen of the Week of Zacks Investment Research:
5 Stocks Near 52-Week High with More Room for Improvement
A 52-week high level generally works as an indicator for investors as stocks near that level are perceived to be winners.
Notably, investors often wonder if the stock is overpriced considering the high price level. While the apprehensions are not absolutely baseless, all stocks hitting a 52-week high are not necessarily overpriced.
In fact, an investor might miss out on top gainers in an attempt to avoid the steep prices of stocks that are near the 52-week high mark.
However, a stock can maintain the momentum and keep scaling new highs with time. So, one should take a more informed approach to understand if any further upside is left.
Here we discuss a strategy to find the right stocks:
Borrowing from the basics of momentum investing, this technique bets on “buy high, sell higher.”
52-Week High: A Good Indicator
Many a time, stocks hitting a 52-week high fail to scale higher despite potential. This is because investors fear that the stocks are overvalued and a price crash is impending.
In fact, overvaluation is quite natural for most of these stocks as investors’ focus (or willingness to pay premium) has helped them reach the level. But that doesn’t always mean an impending decline. Factors such as robust sales, surging profit levels, earnings growth prospects and strategic acquisitions that encouraged investors to bet on these stocks could keep them motivated if there is no tangible negative. In other words, the momentum might continue.
Also, when a string of positive developments dominate the market, investors find their under-reaction unwarranted, even if there are no company-specific driving forces.
And that's what we're screening for today…
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/318373/5-stocks-near-52week-high-with-more-room-for-improvement
Get the remaining stocks on the list and start putting this and other ideas to the test. It can all be done with the Research Wizard stock picking and back testing software.
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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.
Strong Stocks that Should Be in the News
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