In spite of renewed trade tensions with China, the U.S. stock market performed well in May. This is especially thanks to optimism over a potential for COVID-19 vaccine and an uptick in economic activities as lockdown measures started to loosen. Notably, the S&P 500 reclaimed its 3,000 level and the Dow Jones returned to the 25,000 mark.
All the 50 states have lifted restrictions put in place to combat the coronavirus outbreak. The easing has started to propel demand, leading to renewed confidence among investors. In particular, the latest bouts of data indicate that economic damage from the coronavirus pandemic was less severe than anticipated. Jobless claims fell for the first time during the pandemic in the week ended May 23, while readings on durable goods beat forecasts. Additionally, stronger-than-expected consumer and homebuilder confidence created some optimism.
Further, a raft of central bank and government stimulus has been fueling growth. The central bank has plenty of ammunition to rescue the economy from a deep slowdown, indicating potential recovery in the second half of the year. The Fed would expand its existing lending programs or start new ones if required.
While all the sectors gained last month, information technology, materials, communications services, industrials and consumer discretionary were the toppers, per cnbc. We have highlighted one best-performing stock from each from these sectors. These stocks have solid Zacks Rank #1 (Strong Buy), or 2 (Buy) and are likely to perform well if the positive trend continues.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Microvision Inc. MVIS – Up 151.5%
This company develops PicoP scanning technology to create high-resolution miniature projection, and three-dimensional sensing and image capture solutions in the United States and Asia. The Zacks Consensus Estimate has been revised upward from a loss of 15 cents to a loss of 9 cents for this year over the past month and represents 62.5% year-over-year growth. The stock has a Zacks Rank #2 and Growth Score of A.
Camping World Holdings Inc. CWH – Up 138.8%
It is a provider of services, protection plans, products and resources for recreational vehicle enthusiasts. The Zacks Consensus Estimate has been revised upward to 31 cents from a loss of 8 cents for this year over the past month and represents 193.9% year-over-year growth. Camping World has a Zacks Rank #2 and Growth Score of A.
Northern Dynasty Minerals Ltd. NAK – Up 125.5%
This company is engaged in the exploration of mineral properties in the United States. It has witnessed no earnings estimate revision for this year over the past month and has estimated earnings growth of 28.6%. The stock has a Zacks Rank #2 and Momentum Score of A.
Broadwind Energy Inc. BWEN – Up 58.8%
This company is a precision manufacturer of structures, equipment & components for clean tech and other specialized applications. The stock has witnessed no earnings estimate revision for this year over the past month but has an estimated earnings growth of 173.9%. The stock has a Zacks Rank #2 and Growth Score of B.
Avaya Holdings Corp. AVYA – Up 46.9%
This company provides real-time communication applications. It has seen solid earnings estimate revision of 36 cents for the fiscal year (ending September 2020) over the past month but its earnings are expected to decline 19.7% from the year-ago level. The stock has a Zacks Rank #2 and Growth Score of B.
Zacks’ Single Best Pick to Double
From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
This young company’s gigantic growth was hidden by low-volume trading, then cut short by the coronavirus. But its digital products stand out in a region where the internet economy has tripled since 2015 and looks to triple again by 2025.
Its stock price is already starting to resume its upward arc. The sky’s the limit! And the earlier you get in, the greater your potential gain.
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