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Beat the Market the Zacks Way: Walt Disney (DIS), AmerisourceBergen (ABC), C.H. Robinson Worldwide (CHRW) in Focus

·6 min read

The three most extensively followed indexes closed in the green last week, as investors cheered signs of inflation easing and an improvement in consumer sentiment.

The S&P 500, the Dow and the Nasdaq gained 3.26%, 2.92%, and 3.08%, respectively, for the week. While the S&P 500 registered its longest weekly winning streak since November 2021, the Nasdaq too gained for the fourth straight week in a row.

July’s consumer price index remained unchanged from June, mostly due to a decline in gas prices. The producer price index, in fact, fell unexpectedly. At the same time, the University of Michigan’s preliminary reading on consumer sentiment improved this month.

Most importantly, signs of easing inflation now could compel the Federal Reserve to curtail the pace of its monetary tightening measures that resulted in a lot of volatility in the stock market throughout this year. With signs of bullishness seeping back into the market, the S&P 500 has at present regained more than 50% of its losses from its January peak to the June nadir.

However, any slowdown in economic progress following two consecutive negative quarters of growth in GDP, as well as ongoing geo-political tensions, could easily derail the market’s upward trajectory in the near term.

Regardless of market conditions, we, here at Zacks, provide investors with unbiased guidance on how to beat the market.

Zacks Research guided investors last week with its time-tested methodologies as usual. 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 from last week:

Hudson Technologies, Clearwater Paper Soar Following Zacks Rank Upgrade

Shares of Hudson Technologies, Inc. HDSN have gained 9.68% since it was upgraded to a Zacks Rank #1 (Strong Buy) on Aug 5. The rating upgrade was primarily driven by an upward trend in earnings estimates, one of the most powerful forces impacting stock prices. A company's changing earnings picture is at the core of the Zacks rating.

For HDSN, the consensus EPS estimate of $1.79 for the current year has increased 29.71% over the past month.

Rising earnings estimates and the consequent Zacks Rank upgrade for HDSN imply an improvement in the company's underlying business. Investors have started showing their appreciation for this improving business trend by pushing the stock higher.

Check Hudson Technologies’ historical EPS and Sales here>>>

Clearwater Paper Corporation CLW, another stock upgraded to a Zacks Rank #1 on Aug 5, has returned 6.13% over the past week. Over the past month, an 13.89% increase in the current-year consensus EPS estimate has driven the rating upgrade.

The Zacks Rank 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 (Strong Buy) stocks here >>>

Check Clearwater Paper’s historical EPS and Sales here>>>

Zacks Investment Research
Zacks Investment Research


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Zacks Recommendation Upgrade Drive Aemetis, ProFrac Higher

Shares of Aemetis, Inc. AMTX and ProFrac Holding Corp. PFHC gained 32.97% and 18.3%, respectively, since their Zacks Recommendation was upgraded to Outperform on August 8.

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 Model Portfolio Stock Walt Disney Surges 

Shares of The Walt Disney Company DIS, which belongs to the Zacks Focus List, have shot up 12.44% over the past week. 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.

Walt Disney was added to the Focus List on Mar 23, 2020, at $85.98 per share. The stock has gained 41.39% since then to close the last trading session at $121.57.

Since its inception on February 1, 1996, the Focus List portfolio has delivered an annualized return of +12.9%.

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 Stock AmerisourceBergen Delivers Solid Returns

AmerisourceBergen Corporation ABC, a component of our Earnings Certain Admiral Portfolio (ECAP), surged 8.06% last week. ECAP is a model portfolio of 30 concentrated, ultra-defensive, long-term Buy and Hold stocks.

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 portfolio delivered an average return of 2.17% last week. In terms of last week’s returns, The Clorox Company CLX and Paychex, Inc. PAYX followed AmerisourceBergen with 6.25% and 5.48% gains, respectively.

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 Stock C.H. Robinson Worldwide Witnesses Price Increase

C.H. Robinson Worldwide, Inc. CHRW, which is part of our Earnings Certain Dividend Portfolio (ECDP), jumped 9.08% last week. 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 C. H. Robinson Worldwide’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. The ECDP has consistently outperformed the S&P 500 Dividend Aristocrats ETF NOBL.

Click here to access this portfolio on Zacks Advisor Tools.


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Paychex, Inc. (PAYX) : Free Stock Analysis Report
 
AmerisourceBergen Corporation (ABC) : Free Stock Analysis Report
 
C.H. Robinson Worldwide, Inc. (CHRW) : Free Stock Analysis Report
 
The Clorox Company (CLX) : Free Stock Analysis Report
 
The Walt Disney Company (DIS) : Free Stock Analysis Report
 
Hudson Technologies, Inc. (HDSN) : Free Stock Analysis Report
 
Clearwater Paper Corporation (CLW) : Free Stock Analysis Report
 
ProShares S&P 500 Dividend Aristocrats ETF (NOBL): ETF Research Reports
 
Aemetis, Inc (AMTX) : Free Stock Analysis Report
 
ProFrac Holding Corp. (PFHC) : Free Stock Analysis Report
 
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Zacks Investment Research