Five top buy candidates for this week

Investors had a tough month in October, but the overall market appears to have found its footing again and November has gotten off to a strong start.

There are several reasons to expect the market to continue to rebound. The current earnings season has been strong, the mid-term election outcomes were basically what the market expected, and the nation’s unemployment remains very low.

A big reason why October’s selloff was possibly overdone was the fact that a lot of companies were in buyback blackout periods which are now coming to an end. As companies resume their buyback programs analysts expect to see a late earnings rally during the final months of the year.

There are good reasons to be bullish on the market, but October proved that weakness can enter the market at any time. There is no guarantee that November and December will see the market move higher, so investors have to remain prudent and look to put their money to work in the best stocks possible.

The Stock Score Report ranks the stocks in the overall universe using both technical and fundamental criteria which has been a successful approach to picking winning stocks. The combined approach provides an effective method of spotting recent winners that have the best chance of future gains as well.

The following five stocks are currently the top-ranked stocks in the Stock Score Report.

Gray Television

Gray Television (GTN) is a small cap television broadcaster with a market cap of $1.6 billion. GTN shot higher over the summer, and the stock has remained strong even as the overall market corrected in October. GTN is currently trading at its all-time high, and Stock Score Report gives the stock an overall score of 96, making it the top ranked stock at this time. GTN’s technicals are near perfect, and with a very strong 97 fundamental score the company appears to be in great shape to build on its recent gains. The stock has a favorable forward P/E of 15, and analysts forecast average annual earnings growth of 10% for the next five years. Gray Television has already report earnings this season, topping estimates on both the top and bottom line with earnings of $0.70 up from $0.21 during the same period last year. GTN is trading at $19.00 and analysts have a $21.83 average price target on the stock.

Chart courtesy of stockcharts.com

QuinStreet, Inc.

QuinStreet (QNST) offers online marketing solutions. We saw the stock high in the rankings last week, and this week it is the second highest rated stock on the Stock Score Report with an overall score of 95. Technicals are near perfect and QNST has a fundamental score of 88. Earnings have been rising, and analysts forecast profits will rise 44% during the current year and 113% per annum over the next five years. The company last reported earnings October 30, posting positive surprises on both the top and bottom line. The stock gapped higher on the earnings beat, and the stock is now trading just pennies below its 52-week high. QNST trades at $17.17 with an average price target of $18.35.

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Mellanox Technologies, Ltd.

Mellanox (MLNX) manufactures semiconductors. Stock Score Report gives MLNX an overall score of 95, with solid scores across the board. Mellanox has been growing its earnings nicely in recent years, with profits up 37% per annum over the last five years, and analysts expect even stronger growth moving forward with forecast average annual earnings growth of 45% for the next five years. The company reported earnings toward the end of October, with results topping estimates on both the top and bottom line. The strong numbers pushed the stock higher, and MLNX is currently trading just shy of its 52-week high. Analysts see a lot of additional upside in the stock with an average price target of $110.27 versus its current price of $88.80.

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Tivity Health

Stock Score Report gives Tivity Health (TVTY) an overall score of 94. The stock’s technicals are strong and the company has a near perfect fundamental score of 97 which suggests additional upside in the stock moving forward. TVTY traded lower for most of the year before shares started to rally in October. The company reported quarterly numbers on November 5, posting better than expected profits while sales fell a little short of the consensus. The market overlooked the revenue miss and pushed shares higher on the better than expected earnings number. Earnings are up 85% per annum over the last five years and are expected to rise at an average annual rate of 12% for the next five years. Analysts see a lot of additional upside in the stock. TVTY is trading at $37.94 and analysts have an average price target of $45.71 on the stock.

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Nomad Foods Limited

Nomad Foods Limited (NOMD) has been near the top of the rankings the last couple of months, and Stock Score Report currently gives the stock an overall ranking of 94. NOMD sold off a bit in October with the overall market, but shares are already rebounding as strength has started to return to the overall market. The company next reports earnings November 8 and the results should determine whether the stock is able to continue its rebound or if NOMD will lose its current momentum. Analysts forecast earnings of $0.25, but the street has a higher expectation with a whisper number of $0.28. During the same period last year, the company earned $0.29. NOMD trades at $19.36 with an average price target of $22.80.

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