The most recent earnings season has been better than the meager expectations. However, what is abundantly clear is that growth is in short supply.
That is not a big time shocker when you realize that the 20%+ earnings growth from last year was fueled by the immediate impact of a lower corporate tax rate. The boomerang effect is that it would create lower growth this year.
Even still, when growth is so scarce it generally leads investors on a hunt to uncover exceptional growth wherever it exists. That pursuit generally starts with widely followed large cap stocks…which explains why that group is pressing new all time highs. From there investors will work their way down the food chain to smaller, less obvious choices.
My stock screen today was meant to isolate a group of companies that I think will benefit in the future as more investors look beyond large caps to find growth in other sectors. Here are the factors at play in this screen:
- POWR Rating of A or B
- 20%+ expected earnings growth over next 3-5 years
- Stock price under $10
The POWR Ratings helps isolate the companies already experiencing some momentum that is usually a catalyst for more gains ahead.
The 20% earnings growth level is about 4X the average pace of growth this year and thus isolates us to companies with truly exceptional results.
he under $10 aspect was put into place as its usually one of the last groups of stocks that investors look at when seeking their next trade. That’s because these low priced stocks often come with a bit more risk. But given the screening process I went through risk should be somewhat reduced. Plus there is the aspect of outside reward to make the risk more palatable.
Only 6 stocks emerged from this search that met all these criteria. The most well known amongst this group is fairly large Brazilian bank, Banco Bradesco (BBD). But also rising to the occasion were some lesser know small and mid caps like: Alamos Gold (AGI), A10 Networks (ATEN), Aerohive Network (HIVE) and ID Systems (IDSY).
Below are some additional details on each of these 6 attractive stocks. However, your best next step is to click on the ticker for each stock to research it further.
Remember that the POWR Ratings system has 4 components to appreciate the full attractiveness of a stock. That includes its Buy & Hold Grade, Trading Grade, Industry Rank and Peer Grade. Just click the ticker for each stock to discover that information and more.
|Ticker||Company||Market Cap ($mil)||Price||Growth Rate %|
|AGI||Alamos Gold Inc||$2,663||$6.81||50.81|
|IDSY||Id Systems Inc||$114||$6.26||30.00|
|VISI||Volt Info Sci||$98||$4.64||25.00|
Also here are links to 3 other popular destinations to make the best use of the POWR Ratings:
Full List of “A ”Rated Strong Buy Stocks– See all the top rated stocks.
About the POWR Ratings– Learn what’s build inside the POWR Ratings that helps find stocks ready to outperform.
Reitmeister Total Return portfolio. This is where Steve Reitmeister employs his 40 years of investment experience to hand select the best POWR Ratings stocks.
BBD shares were trading at $9.04 per share on Wednesday afternoon, down $0.24 (-2.59%). Year-to-date, BBD has gained 10.41%, versus a 20.12% rise in the benchmark S&P 500 index during the same period.
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About the Author: Steve Reitmeister
Steve is better known to the StockNews audience as “Reity”. Not only is he the CEO of the firm, but he also shares his 40 years of investment experience in the Reitmeister Total Return portfolio. Learn more about Reity’s background, along with links to his most recent articles and stock picks. More...
More Resources for the Stocks in this Article
|Ticker||POWR Rating||Industry Rank||Rank in Industry|
|BBD||Get Rating||Get Rating||Get Rating|
|Get Rating||Get Rating||Get Rating|
|ATEN||Get Rating||Get Rating||Get Rating|
|HIVE||Get Rating||Get Rating||Get Rating|
|Get Rating||Get Rating||Get Rating|