Top 5 Mid-Cap Momentum Stocks to Earn Defying Volatility – July 13, 2022

The high volatility of US stock markets since the start of the year shows no sign of abating. US equities have corrected significantly so far in 2022 after a fabulous rally over the past two pandemic-ridden years.

The complete devastation of the global supply chain system, rising inflation, a higher interest rate regime as well as tighter monetary control, the war between Russia and Ukraine and lockdowns in China due to the resurgence of COVID-19 infections have significantly shaken investors’ confidence in the risks. assets like stocks.

Despite these negatives, it should be prudent at this stage to invest in dynamic mid-cap stocks with a favorable Zacks ranking. Here are five such actions – The Howard Hughes Company. (HHC free report), Wyndham Hotels & Resorts Inc. (W.H. free report), Greif Inc. (WEF free report), CVR Energy Inc. (LCI free report) and Avis Budget Group Inc. (SELF Free report)

Why Mid-Cap Momentum Stocks

Investing in mid-cap stocks is often recognized as a good portfolio diversification strategy. These stocks combine the attractive attributes of small and large cap stocks. Top-ranked mid-cap stocks have strong potential to improve their profitability, productivity and market share and can become large-cap stocks in due course.

If the economic recovery slows due to unexpected internal or external disruptions, mid-cap stocks will be less likely to suffer losses than their large-cap counterparts due to less international exposure.

On the other hand, if the crisis does not worsen, these stocks will gain more than small caps due to established management teams, an extensive distribution network, brand recognition and a easy access to capital markets.

On the other hand, momentum investing requires continuous stock valuation, ensuring that an investor doesn’t choose a beaten name or overlook a booming one. Aggressive investors buy high anticipating that a stock will only rise in the short to medium term.

Therefore, dynamic mid-cap stocks with a favorable Zacks ranking are likely to become an ideal investment mix at this stage.

Our top picks

We narrowed our search to five dynamic mid-cap stocks (market capitalization >$1B the full list of today’s Zacks #1 Rank stocks here.

The graph below shows the price performance of our five picks over the past three months.

Image source: Zacks Investment Research

Wyndham operates as a hotel franchisor primarily in Canada, Mexico, Colombia, Ecuador, Turkey, Germany, United Kingdom, Caribbean and Margarita Island in Venezuela. WH operates through the hotel franchise and hotel management segments.

The Hotel Franchise segment licenses its lodging brands and provides related services to third-party hotel owners and others. The Hotel Management segment provides hotel management services for full-service and limited-service hotels.

Wyndham forecasts a profit growth rate of 13.3% for the current year. The Zacks consensus estimate for current year earnings has improved 0.3% over the past 7 days.

Greif is engaged in the production and sale of industrial packaging products and services worldwide. The GEF projects adjusted earnings per share between $7.45 and $7.75 for fiscal 2022, indicating 36% year-over-year growth at the midpoint. Greif has witnessed strong demand in the major end markets of its business.

The WEF implemented price increases in response to robust demand and to combat cost inflation, which should support earnings. Greif’s restructuring activities, which include optimizing and integrating operations in the Paper Packaging & Services segment, and streamlining operations and closing underperforming assets in the Global Industrial Packaging segment, are expected to generate savings . Its efforts to reduce debt levels are commendable.

Greif forecasts earnings growth of 36.8% for the current year (ending October 2022). The Zacks consensus estimate for current year earnings has improved 0.4% over the past 7 days.

Avis Budget Group offers car and truck rental, car sharing and ancillary services to businesses and consumers. CAR’s ability to meet a wide range of mobility demands helps it expand and strengthen its global presence through organic growth.

Avis Budget Group operates through distinct global brands that focus on different market segments and complement other brands in their respective regional markets. CAR’s fleet expansion and technology enhancement efforts are likely to improve its offerings.

Avis Budget Group forecasts profit growth of 74.7% for the current year. The Zacks consensus estimate for current-year earnings has improved 2.4% over the past 30 days.

CVR Energy is an independent refiner and marketer of high-value transportation fuels. CVI is also a producer of ammonia and urea ammonia nitrate fertilizers. CVR Energy’s petroleum business includes a full coking sour crude refinery in Coffeyville, KS.

In addition, CVI’s supporting businesses include a crude oil gathering system serving central Kansas, northern Oklahoma and southwestern Nebraska, storage and terminal facilities for asphalt and refined fuels in Phillipsburg, KS., and an in-rack marketing division supplying product to tanker customers and flow terminals.

CVR Energy expects earnings growth of over 100% for the current year. The Zacks consensus estimate for current-year earnings has improved 25.4% over the past 30 days.

The Howard Hughes operates as a real estate company engaged in the development of planned communities and other strategic real estate development opportunities throughout the United States. HHC operates in two business segments: Master Planned Communities and Strategic Development.

Howard Hughes’ Master Planned Communities segment includes the development and sale of residential and commercial land, primarily in large-scale projects in and around Columbia, Maryland, Houston and Las Vegas. The Strategic Development segment consists of real estate and short, medium and long-term development projects.

The Howard Hughes expects profit growth of 67% for the current year. The Zacks consensus estimate for current-year earnings has improved 11.7% over the past 30 days.

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