Top 5 Momentum Picks for January Despite Market Volatility
Zacks Investment Research | Jan 13, 2022 06:22AM ET
Wall Street successfully defeated the pandemic with astonishing performances in 2020 and 2021. However, U.S. stock markets have begun 2022 with volatile trading. Mounting inflation, and the Fed's reaffirmation of doing away with the pandemic-era easy money policies and a possible hike in interest rate after two years dented market participants’ sentiment.
Nevertheless, the overall trend of the market will remain northbound based on the strong fundamentals of the U.S. economy. Moreover, a likely end of the pandemic after this winter should be another positive. At this stage, it will be prudent to invest in stocks with a favorable Zacks Rank that have strong momentum for the near-term. Five of them are - Exxon Mobil Corp. the complete list of today’s Zacks #1 Rank stocks here .
The chart below shows the price performance of our five picks in the past year.
Exxon Mobil made multiple world-class oil discoveries at the Stabroek Block, located off the coast of Guyana. XOM has raised the estimate for discovered recoverable resources from the Stabroek Block to approximately 10 billion oil-equivalent barrels.
Exxon Mobile’s bellwether status and an optimal integrated capital structure, which have historically led to industry-leading returns make it a relatively lower-risk energy sector play. The integrated oil behemoth expects to reduce greenhouse gas emissions by 30% in its upstream business. By the same time, XOM expects to reduce flaring and methane emissions by 40%.
Exxon Mobil has an expected earnings growth rate of 21.6% for the current year. The Zacks Consensus Estimate for current-year earnings improved 2.7% over the last 7 days. The stock price of XOM has jumped 46.9% in the past year.
The Charles Schwab remains focused on enhancing trading revenues, which have been under pressure for a few years. For this, SCHW continues to undertake several initiatives including lowering its basic online equity and ETF trade commissions to zero and reducing fees for the Schwab market cap-weighted index mutual funds.
Further, it launched Schwab Stock Slices, through which investors will be able to own shares of any company in the S&P 500 Index starting at $5 each, even though these shares cost more. These efforts, aimed at building client base and the acquisition of TD Ameritrade, are likely to lead to further improvement in the trading income of Charles Schwab.
SCHW has an expected earnings growth rate of 20.2% for the current year. The Zacks Consensus Estimate for current-year earnings improved 4% over the last 7 days. The stock price of Charles Schwab has soared 59.3% in the past year.
Interactive Brokers Group operates as an automated electronic broker worldwide. IBKR specializes in executing and clearing trades in securities, futures, foreign exchange instruments, bonds, and mutual funds.
Interactive Brokers Group’s efforts to develop proprietary software (including IBKR Lite), its low level of compensation expenses relative to net revenues and an increase in emerging market customers will likely continue aiding its financials. The acquisition of the retail unit of Folio Investments will strengthen IBKR’s position in the online brokerage space.
Interactive Brokers Group has an expected earnings growth rate of 5.5% for the current year. The Zacks Consensus Estimate for current-year earnings improved 2.3% over the last 7 days. The stock price of IBKR has gained 11.1% in the past year.
Albemarle is likely to gain from long-term growth in the battery-grade lithium market. ALB is expected to benefit from its actions to boost its global lithium derivative capacity. Albemarle remains on track with its La Negra III and IV projects.
ALB also remains focused on executing its cost-reduction program. Its cost-saving actions are also expected to support margins in 2021. Albemarle should also benefit from the synergies of the Rockwood acquisition. The buyout has provided ALB a complimentary product portfolio.
ALB has an expected earnings growth rate of 51.5% for the current year. The Zacks Consensus Estimate for current-year earnings improved 1.3% over the last 7 days. The stock price of Albemarle has climbed 34% in the past year.
STMicroelectronics is a global independent semiconductor company that designs, develops, manufactures and markets a broad range of semiconductor integrated circuits and discrete devices used in a wide variety of microelectronic applications.
STM operates through Automotive and Discrete Group, Analog, MEMS and Sensors Group, and Microcontrollers and Digital ICs Group segments. STMicroelectronics’ products are primarily used in telecommunications systems, computer systems, consumer products, automotive products and industrial automation and control systems.
STMicroelectronics has an expected earnings growth rate of 32.4% for the current year. The Zacks Consensus Estimate for current-year earnings improved 5.5% over the last 7 days. The stock price of STM has advanced 18.6% in the past year.
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