In this volatile market environment, I have decided to look for value by screening for stocks that have fallen the most despite posting strong quarterly reports during this earnings season.
I believe that earnings momentum is a stable metric that both value and growth investors look for, and gives investors something fundamental to focus on away from the noise and volatility of the violent intraday trading swings we've experienced lately.
With that in mind, I used Bloomberg to find the stocks that beat consensus profit estimates this quarter and did not previously warn or lower forward guidance.
I then sorted them by return in three different groups: large-caps, mid-caps and small-caps.
As of Tuesday's closing prices, each of these stocks has fallen at least as much post-earnings as the 8%-plus that the benchmark
has dropped since its intraday peak reached on July 16.
This screen is similar to the one I published in the
newsletter earlier this week.
I run a different proprietary screen in each weekly issue.
These stocks are meant as a starting point for readers, similar to the tools I use to generate trading ideas.
Readers should conduct their own homework before making any investment decisions.
David Peltier is a research associate at TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks. He also doesn't invest in hedge funds or other private investment partnerships. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Peltier appreciates your feedback;
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