Monday, March 07, 2011

Earnings Estimate Revisions Stock Opportunities

Zacks Investment Research ROI
“Earnings estimate revisions are the most powerful force impacting stock prices”

Zack Investment Research Founder Leonard Zacks, Ph.D. Mathematics M.I.T.


Zacks has just released four powerful Free Buy Rank stocks. Zacks Investment Research is the industry’s leading independent research firm highlights one Zacks #1 Rank Strong Buy or a Zacks #2 Rank Buy stock for each of the four main styles of investing: Aggressive Growth, Growth & Income, Momentum, and Value.

The four stock picks this week are: Lindsay Corp, Goodrich Corporation, Northern Oil and Gas, Inc, and Lithia Motors, Inc.

Outperforming the Market Averages and Inflation is Your Minimum Investing Goal

Zacks #1 Rank Stocks have nearly tripled the S&P 500 since 1988, producing an average annual return of +28%. Performance has been notable even during volatile and down times. For example, during the last bear market, 2000-2002, the market tumbled -37.6% – but Zacks #1 Rank stocks gained +43.8%.

Here is a summary of today's selected stocks that are now highly rated by Zacks:

Aggressive Growth – Lindsay Corp - Ticker LNN

Lindsay Corp has been on fire after being featured as a Zacks Rank Buy in October. There was a small hiccup in the earnings outlook but things are back on track thanks to news from a competitor.

Growth & Income – Goodrich Corporation – Ticker GR

Goodrich Corporation carried its strong momentum into the fourth quarter and delivered its third consecutive positive earnings surprise. (

Momentum – Northern Oil and Gas, Inc – Ticker NOG

Northern Oil and Gas, Inc. recently spiked to a new all-time high on the company's strong Q4 results and rising crude prices. Throw in a bullish 78% growth projection and this Zacks #1 rank stock is a momentum leader.

Value – Lithia Motors, Inc. – Ticker LAD

America's love affair with the automobile has come roaring back to life. Lithia Motors, Inc. saw sales jump 31% in the fourth quarter as both new and used car sales were in the double digits. This Zacks #2 Rank (buy) expects the good times to continue as it just raised 2011 guidance.

Analysts Earnings Estimates and Their Revisions

Underlying the four free stock picks is a simple truth that first appeared in a Financial Analysts Journal article published in 1979. Leonard Zacks, a Ph.D. in Mathematics from M.I.T. found that "earnings estimate revisions are the most powerful force impacting stock prices." Zacks #1 Rank is awarded to a stock when analysts sharply upgrade their estimates of what the company will earn.

About Zacks Investment Research

Zacks was formed in 1978 by Len Zacks. The company continually processes stock reports issued by 3,000 analysts from 150 brokerage firms. It monitors more than 200,000 earnings estimates, looking for changes. Then, when changes are discovered, they’re applied to help assign more than 4,400 stocks into five Zacks Rank categories: #1 Strong Buy, #2 Buy, #3 Hold, #4 Sell, and #5 Strong Sell. This proprietary stock-picking system continues to outperform the market by a nearly 3-to-1 margin.

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