We have been getting a lot of positive feedback on our Stock Score Report which uses both technical and fundamental data to rank the overall stock universe.
By combining both investment decision approaches, we have consistently found some very strong big-name stocks with a good chance of trading higher. Strong technical scores illustrate a stock’s recent trading strength, and the confidence the market has in the company’s underlying business.
When you add in a company’s underlying fundamentals, you are able to narrow the universe even further to only include companies that are set up for future success. The combination of the two very different screening methods has consistently managed to create from very strong buy candidates.
We have been highlighting five of the most current leaders each week, and this week we have compiled another five stocks that are near the top of the rankings that look incredibly attractive at this time.
PRA Health Sciences
PRA Health Sciences (PRAH) gets a Stock Score report overall score of 91. The stock’s long and short-term technical scores are near perfect, and its fundamentals get a score of 79. The company provides outsourced clinical diagnostic services to the pharmaceutical and biotech sectors. The company has enjoyed strong growth in recent years, with earnings rising an average 31.2% over the last five years. Looking ahead, analysts see more of the same, with profits forecast to rise by around 18% a year over the next five years. The company’s most recent quarterly report at the start of August topped estimates on the top and bottom line and drove shares to a new record high. PRAH is currently trading at $107.44 with an average price target of $110.11.
Canadian waste management company Waste Connections (WCN) has an overall score of 89 on the Stock Score Report. The stock’s scores are strong across the board, and WCN is currently trading just pennies below its all-time high. While the waste industry is slow growth, it does enjoy strong barriers of entry, which help sector leaders maintain their market share with little threat from new upstarts. Over the last five years, the company has seen earnings fall by an average 5.7% per year but looking ahead analysts see average annual earnings growth of 13.4%. The strong growth estimates have been pushing shares higher, along with a string of nine straight earnings beat and revenues outpacing estimates in eight of those quarters, with sales falling in-line with estimates once. The company’s most recent quarterly report showed year over year earnings growth of 18%. WCN trades at $80.07 with an average price target of $86.02.
Discount retailer Dollar General (DG) has an overall score of 89 on the Stock Score Report. DG has near perfect technical scores, and a fundamental ranking of 75. The stock recently traded up to an all-time high following the company’s better than expected second-quarter numbers that topped estimates on both the top and bottom line. A strong economy with low unemployment continues to boost retail stocks. DG has enjoyed average annual earnings growth of 11.8% over the last five years, and analysts expected additional earnings growth moving forward, forecasting 15.1% per annum earnings growth for the next five years. The stock trades at $110.69 virtually in-line with its $110.67 average price target, but expect analysts to start ratcheting up their price targets following the company’s better than expected August 30 quarterly report.
Stock Score Report gives home goods retailer Lowe’s (LOW) an overall score of 89. LOW has strong technical scores, and a fundamental ranking of 76. Lowe’s, like most home goods retailers, has been strong in recent years as the housing market has shown strength. There are some fears in the market over the eventual impact of rising interest rates on the fate of the housing market, but rates remain incredibly low, and most analysts agree it will take several more rate hikes before we see any meaningful impact that could de-rail the housing market. LOW has a forward P/E of 18, with earnings expected to rise 15.1% per annum over the next five years. The stock is currently trading at $109.25 with an average price target of $114.36.
Credit card company Visa (V) has been a fixture at the top of the stock universe, and it currently has an overall score of 83 from the Stock Score Report. The stock’s long-term technical and fundamental scores are high, with a short-term technical score of 74 due to recent profit taking in the sector. A strong economy, with low unemployment, has consumers feeling very confident, made evident by the strength in the retail sector during the recent earnings season. Not only are consumers spending, they are handling an increasing amount of their transactions with credit card or other payment solutions where Visa operates. We are moving closer to a “cashless society”, and as the leader in the sector Visa should continue to see transaction volumes rise. Visa is expected to grow earnings by 19% per annum over the next five years, and the stock currently trades at $143.89 with an average price target of $155.17.