Chicago, IL – November 20, 2023 – Stocks in this week’s article are DexCom DXCM, Arthur J. Gallagher & Co. AJG, Limbach LMB and The Hartford Financial Services Group HIG.
Best 4 Stocks Exhibiting Solid Earnings Growth
A company always aims to make money sooner or later. Therefore, earnings growth is the main priority for any organization.
So, what's earnings growth? Study a company's revenues over a given period, subtract the production cost, and you have earnings. Incidentally, this is the most important variable manipulating its share price. But, expectations of earnings play a significant role.
Earnings Estimates & Share Price Movements
Frequently, we have seen a decline in the stock price despite earnings growth and a rally in price following an earnings decline. This is largely the result of a company's earnings failing to meet market expectations.
Earnings estimates embody analysts' opinions on factors such as sales growth, product demand, competitive industry environment, profit margins, and cost control. Thus, earnings estimates serve as a valuable tool, while making investment decisions. Earnings estimates also help analysts assess the cash flow to determine the fair value of a firm.
Thus, investors should be on the lookout for stocks ready to make a big move. Hence, investors need to buy stocks with historical earnings growth and are seeing a rise in quarterly and annual earnings estimates.
The above criteria narrowed the universe of around 7,839 stocks to only eight. Here are the top four stocks that stand out:
DexCom is a medical device company. DexCom has a Zacks Rank #2 (Buy). DXCM's expected earnings growth rate for the current year is 64.4%. You can see the complete list of today's Zacks #1 (Strong Buy) Rank stocks here.
Arthur J. Gallagher & Co. provides insurance brokerage and consulting services. Arthur J. Gallagher has a Zacks Rank #2. AJG's expected earnings growth rate for the current year is 13.6%.
Limbach provides building systems. Limbach has a Zacks Rank #1. LMB's expected earnings growth rate for the current year is 173.4%.
The Hartford Financial Services Group is a major multi-line insurance and investment company in the United States. Hartford Financial Services has a Zacks Rank #2. HIG's expected earnings growth rate for the current year is 7.9%.
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