- (0:45) – Finding Value Stocks That Recently Sold Off
- (6:30) – Tracey’s Top Stock Picks
- (19:20) – Episode Roundup: NUS, VFC, AUY, MTOR, VRTX
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Welcome to Episode #252 of the Value Investor Podcast.
Every week, Tracey Ryniec, the editor of Zacks
Value Investor portfolio
, shares some of her top value investing tips and stock picks.
Although the major stock indexes may only be a few percent off their all-time highs, some stocks have corrected much more.
It’s not unusual for some stocks to be down 10%, 20% or even more.
That means some stocks are on sale.
But how do value investors find the best quality stocks that are also a buying opportunity?
Screening for Stocks on Sale
To screen for stocks with quality, include the Zacks Rank of #1 (Strong Buy) or #2 (Buy).
The top Zacks Rank usually means that Wall Street analysts are revising earnings estimates higher.
Zacks Screener on Zacks.com also includes a “price as a % of 52-week high-low range” option.
That means you can screen for stocks within, say, 10% of their 52-week high but you can also look for stocks within 10% of their 52-week lows.
How many stocks have both the top Zacks Ranks and are near their 52-week lows?
36 stocks have this disconnect.
It’s rare.
5 Top Ranked Stocks that are on Sale Right Now
1.
Nu Skin Enterprises, Inc.
NUS
has fallen 28% in the last 3 months and is now at a new 52-week low. This beauty and wellness company does a lot of business in Asia which is making traders nervous due to the coronavirus outbreak there. But the analysts are holding firm on 2021 and 2022 earnings estimates, for now. It’s cheap, with a forward P/E of just 9.4.
2.
VF Corporation
VFC
owns some of the hottest retail brands in Vans, North Face and Timberland. But shares are down 22.5% year-to-date and are at new 52-week lows. Yet earnings are expected to rise 150% this fiscal year and 16.3% next year. It trades with a PEG ratio of just 0.8, including there is both growth and value.
3.
Yamana Gold
AUY
, a gold miner, has slid 27.8% year-to-date. It will trade with the gold price. 4 estimates have been revised higher over the last 60 days. Shares are cheap, with a forward P/E of just 13.1.
4.
Meritor
MTOR
is a global supplier of drivetrain, mobility, braking, aftermarket and electric powertrain solutions. Earnings are expected to soar 118% in fiscal 2021 and another 54% in fiscal 2022. 2 estimates were revised higher for both years in the last 2 months. No estimates have been cut. It’s cheap, with a forward P/E of just 8.5 as shares have fallen 22.9% year-to-date.
5.
Vertex Pharmaceuticals
VRTX
is a large cap drug manufacturer. Shares are down 22% year-to-date as it trades within 1% of its 52-week low. Yet it’s supposed to grow earnings by 19.9% in 2021 and another 6.2% in 2022. It trades with a forward P/E of just 15.
What else should you know about screening for stocks on sale?
Listen to this week’s podcast to find out.
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