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Zacks.com featured highlights include AMN Healthcare Services, Quanex Building Products, Sonoco and Super Micro Computer

·7 min read

For Immediate Release

Chicago, IL – August 11, 2022 – Stocks in this week’s article are JAMN Healthcare Services AMN, Quanex Building Products NX, Sonoco SON and Super Micro Computer SMCI.

4 Stocks Trading Near 52-Week Highs That Can Scale Higher

Investors generally consider a 52-week high as a good criterion to determine an entry or exit point for a given stock. However, stocks touching new 52-week highs are often predisposed to profit-taking, resulting in pullbacks and trend reversals.

Moreover, given the high price, investors often wonder if the stock is overpriced. While the speculations are not absolutely baseless, all stocks hitting a 52-week high are not necessarily overpriced.

In fact, investors might lose out on top gainers in an attempt to avoid the steep prices.

Stocks such as AMN Healthcare Services, Quanex Building Products, Sonoco and Super Micro Computer are expected to maintain the momentum and keep scaling new highs. More information on a stock is necessary to understand whether or not there is scope for further upside.

Here we discuss a strategy to find the right stocks. The technique borrows from the basics of momentum investing and bets on "buy high, sell higher."

52-Week High: Good Indicator

Many a time, stocks hitting a 52-week high fail to scale higher despite having potential. This is because investors fear that the stocks are overvalued and expect the price to crash.

Overvaluation is natural for most of these stocks as investors' focus (or willingness to pay the premium) has helped them reach the level. But that does not always indicate 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 dominates the market, investors find their under-reaction unwarranted, even if there are no company-specific driving forces.

Here are our four picks of the thirty-eight stocks that made it through the screen:

AMN Healthcare Services is a travel healthcare staffing company. It recruits and places nurses, physicians and other healthcare professionals in travel or permanent assignments at acute-care facilities, in physician practice groups as well as at other healthcare facilities.  The recent Connetics USA buyout is expected to expand its International Staffing business. Strength in the healthcare Managed Services Program and a broad array of services augur well.

The company currently sports a Zacks Rank of 1 and has a VGM Score of A. The Zacks Consensus Estimate for AMN Healthcare Services' 2022 earnings has been revised upward by 7.2% to $11.16 per share in the past 30 days. The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 15.6%.

Quanex Building Products is an industry-leading manufacturer of components sold to Original Equipment Manufacturers in the building products industry. Quanex designs and produces energy-efficient fenestration products in addition to kitchen and bath cabinet components.

The company currently sports a Zacks Rank of 1 and has a VGM Score of A. The Zacks Consensus Estimate for Quanex Building Products' 2022 earnings has remained steady at $2.35 per share in the past 30 days. The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 30.2%.

Sonoco is a leading provider of consumer packaging, industrial products, protective packaging and packaging supply chain services. Strong recovery in price and cost across most of its businesses, robust end-market demand, the Ball Metalpack acquisition, productivity initiatives and improved volume/mix are likely to drive the company's results in the near term.

Sonoco's Consumer Packaging segment will continue to gain traction from the flexible packaging business and plastic food packaging. Its Industrial Paper Packaging segment will gain on strong demand for global tubes, cores and cones.

The company currently sports a Zacks Rank of 1 and has a VGM Score of C. The Zacks Consensus Estimate for Sonoco's 2022 earnings has moved up by 11.4% to $6.33 per share in the past 30 days. The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 4.06%.

Super Micro Computer designs, develops, manufactures and sells energy-efficient, application optimized server solutions based on the x86 architecture. SMCI's solutions include a range of rack mount and blade server systems as well as components. Super Micro Computer emphasizes superior product design and uncompromising quality control to produce industry-leading server-boards, chassis and server systems.

The company currently sports a Zacks Rank of 1. The Zacks Consensus Estimate for Super Micro's fiscal 2023 earnings has moved up by 13.9% to $5.75 per share in the past 30 days. The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 20.26%.

Get the rest of the 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.

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.

For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/1966548/4-stocks-trading-near-52-week-high-that-can-scale-higher

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

Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.

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Contact: Jim Giaquinto

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.


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Sonoco Products Company (SON) : Free Stock Analysis Report
 
AMN Healthcare Services Inc (AMN) : Free Stock Analysis Report
 
Quanex Building Products Corporation (NX) : Free Stock Analysis Report
 
Super Micro Computer, Inc. (SMCI) : Free Stock Analysis Report
 
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