Quant Ratings Updated on 126 Stocks Dear Reader, I’m going to let you in on a little secret… I loathe the month of August.
The fact is that in August trading volume gets lighter, and the market is more susceptible to manipulation, and, in turn, wild swings. This is because many Wall Streeters jet off on vacation and Europe also takes extended holidays in August.
The past few years have bucked the trend, with the market actually exhibiting some strength in early to mid-August before the dog days of summer set in. I know the broader market didn’t start this August strong out of the gate, but this isn’t surprising considering the strength in July.
All of the major indices rallied substantially higher: The S&P 500 and Dow were up 3.1% and 3.4%, respectively, while the NASDAQ soared 4.1%. So, the market needed to digest some of those gains, and that’s what it did today.
The good news is I don’t expect any major market consolidation until later this month, as the second-quarter earnings season should continue to reward stocks for a couple more weeks. 51% of S&P 500 companies have released results, and, so far, the results have been very positive: According to FactSet, 80% of S&P 500 companies have exceeded analysts’ earnings expectations, posting an average 5.9% earnings surprise. 64% of S&P 500 companies have beaten sales forecasts, and the average sales surprise is 1.5%. I should also add that earnings are working. We saw this last week with Alphabet Inc. (GOOGL), Meta Platforms, Inc. (META) and Microsoft Corporation (MSFT). Shares of Alphabet and Meta Platforms soared to new 52-week highs in the wake of the companies’ strong earnings results, while shares of Microsoft slipped lower on soft forward-looking guidance. This Week’s Ratings Changes With earnings reports now coming in fast and furious, my Portfolio Grader ratings are also fluctuating more frequently. After taking a close look at the latest data on institutional buying pressure and each company’s fundamental health, I decided to revise my Portfolio Grader recommendations for 126 big blue chips. This compares to 90 revisions last week.
Thirty stocks were downgraded over the weekend. I’ve listed the first 10 stocks that were downgraded to a D-rating, or “Sell,” but you can find the full list – including the stocks’ Fundamental and Quantitative Grades – here. Chances are that you have at least one of these stocks in your portfolio, so you may want to give this list a skim and act accordingly. | | | A | Agilent Technologies, Inc. | D | | AEE | Ameren Corporation | D | | AZPN | Aspen Technology, Inc. | D | | CF | CF Industries Holdings, Inc. | D | | CNI | Canadian National Railway Company | D | | CNP | CenterPoint Energy, Inc. | D | | CSL | Carlisle Companies Incorporated | D | | DEO | Diageo plc Sponsored ADR | D | | EFX | Equifax Inc. | D | | ENPH | Equity LifeStyle Properties, Inc. | D | Follow the Money There’s a lot of cash that’s been sitting on the sidelines this year, and it’s finally pouring back into the market. While we’re seeing that money go into companies that report strong earnings, the biggest benefactors remain artificial intelligence (AI) and technology stocks.
And it’s no surprise why: The AI Revolution is here, and the companies that are able to incorporate AI into their offerings and services are benefitting the most from it. My fellow InvestorPlace colleagues Eric Fry and Luke Lango agree that there is a lot of potential in the AI space, so we decided to team up and create a very special portfolio called the AI Revolution Portfolio. It features our nine top picks that are riding the AI Revolution.
We combined my quantitative stock-rating system with Eric’s global macro investing expertise and Luke’s technology insights, and we found nine stocks that we believe will not only dominate their industries because of their use of AI, but also shape the way the world uses this nascent technology.
But we’re not done building this portfolio yet…
Just this week we found another exciting AI play with significant upside potential. We’ll be releasing the full details on the company – including why we’re so bullish on it right now – after the market closes on Thursday.
Join us at AI Revolution Portfolio today so you receive our new recommendation as soon as we publish it on our website.
I should add that if you become a member of AI Revolution Portfolio today, you’ll also receive two brand-new reports: How to Buy Private Shares of an AI Innovator and 10 Stocks That Could Go to Zero.
In the first report, Luke explains how to invest in a private AI company in the culinary space. And in the second report, we feature 10 stocks that could soon go to zero as the AI story plays out. These stocks are household names and are held by millions of investors.
Click here to find out how to sign up for AI Revolution Portfolio today. Sincerely, |
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