New to investing? This medical stock 1 could be the perfect starting point
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One of our most popular services, Zacks Premium offers daily Zacks Ranking and Zacks Industry Ranking updates; full access to the Zacks #1 ranking list; Equity Research Reports; and premium action screens like the ESP filter on gains. All are useful tools for finding out what stocks to buy, what to sell, and what are the hottest industries today.
It also includes the Focus List, a long-term portfolio of the best stocks that have all the elements to beat the market.
Breaking down Zacks focus list
Building an investment portfolio from scratch can be difficult, so if you could, wouldn’t you take a look at a curated list of the best stocks?
This is what the Zacks Focus list offers. It is a 50-stock portfolio that serves as a starting point for long-term investors to build their individual portfolios. The stocks included in the list are expected to outperform the market over the next 12 months.
What makes the Focus list even more useful is that each pick comes with a comprehensive Zacks analyst report, which explains the reasoning behind each stock’s pick and why we think it is. a good long-term choice.
The portfolio’s past performance only reinforces why investors should take it as a starting point. For 2020, the Focus List gained 13.85% on an annualized basis compared to the S&P 500 return of 9.38%. Cumulatively, the portfolio returned 2,519.23% while the S&P returned 854.95%. Returns are for the period from February 1, 1996 to March 31, 2021.
Focus List Methodology
When stocks are selected for the Focus list, it reflects our enduring reliance on the power of earnings estimate revisions.
Earnings estimates, or growth and profitability expectations, come from brokerage analysts who track publicly traded companies; these analysts work with company management to analyze all aspects that could affect future earnings, such as interest rates, the economy, and sector and industry optimism.
What a company will earn down the road also needs to be considered, and that’s why earnings estimate revisions are so important.
When a stock receives upward revisions to earnings estimates, it will likely see even more positive changes going forward. For example, if an analyst raised their earnings outlook last month, they will likely do so again this month, and other analysts will follow suit.
Harnessing the power of earnings estimate revisions is where the Zacks Ranking comes in. The Zacks Ranking, which is a unique and proprietary stock rating model, uses earnings estimate revisions to help build a portfolio winner.
Four main factors make up the Zacks rank: Accord, Magnitude, Upside Down, and Surprise. Each is given a raw score which is recalculated each night and compiled into the leaderboard, and with this data the stocks are then ranked into five groups, ranging from “Strong Buy” to “Strong Sell”.
The Focus list is made up of stocks hand-picked from a long list of companies ranked #1 (Strong Buy) or #2 (Buy), meaning each new addition benefits from a bullish consensus on earnings among analysts.
Since stock prices react to revisions, it can be very profitable to buy stocks with rising earnings estimates. By buying stocks from the targeted list, you are therefore likely entering companies that will have increased future earnings estimates, which could lead to price momentum.
Discussion List Spotlight: HCA Healthcare (HCA)
Effective May 8, 2017, the company name was changed to HCA Healthcare, Inc. from HCA Holdings, Inc. It is the largest non-governmental operator of acute care hospitals in the United States. Based in Nashville, TN, it operates hospitals and related health services. care entities.
On January 7, 2019, HCA was added to the Focus listing at $123.39 per share. Shares are up 116.47% to $267.10 since then, and the company is No. 3 (Hold) on the Zacks ranking.
For fiscal 2022, nine analysts have revised their earnings estimate higher in the past 60 days, and Zacks’ consensus estimate rose $0.24 to $18.84. HCA shows an average earnings surprise of 17.5%.
HCA earnings are also expected to grow by 7.7% for the current fiscal year.
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HCA Healthcare, Inc. (HCA): Free Inventory Analysis Report
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