Zacks.com Featured Highlights Include: Denny's, Heico, Oasis Midstream Partners, NV5 Global And Bio-Path
Zacks Investment Research | Jan 22, 2020 09:07PM ET
For Immediate Release
Chicago, IL – January 23, 2020 – Stocks in this week’s article are Denny's Corporation (NASDAQ:DENN) , Heico Corporation (NYSE:HEI) , Oasis Midstream Partners LP (NASDAQ:OMP) , NV5 Global, Inc. (NASDAQ:NVEE) and Bio-Path Holdings Inc. (NASDAQ:BPTH) .
5 Top-Ranked Stocks to Bet Big on Rising P/E Investing
Generally, investors are in search of stocks with a low price-to-earnings (P/E) ratio. The idea is that the lower the P/E, the higher will be the value of the stock. It means a stock’s current market price is not priced in yet, and has room left to run owing to its higher earnings potential. This clearly justifies investors’ inclination toward low P/E stocks.
But stocks with a rising P/E are also worth a bet. We’ll tell you why.
Why Rising P/E a Valuable Tool?
Investors should note that stock price moves in tandem with earnings performance. If earnings come in stronger, the price of a stock shoots up. Solid quarterly earnings and the forward guidance boost earnings forecasts, leading to stronger demand for the stock and a rise in price.
So, if the price is rising steadily, it means that investors are assured of the stock’s fundamental strength and expect some strong positives out of it. Also, studies have revealed that stocks have seen their P/E ratios jump more than 100% from their breakout point in the cycle. So, if you can pick stocks early in their breakout cycle, you can end up seeing considerable gains.
For the rest of this Screen of the Week article please visit Zacks.com at: Zacks Investment Research
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