Dynamic investing revolves around the idea of following the recent trend of a two-way action. In the “long” context, investors “will buy at a high price, but hope to sell even higher”. With this methodology, it is essential to take advantage of trends in the price of a stock; once a stock establishes a price, it is more than likely to continue moving in that direction. The goal is that once a stock moves on a fixed path, it will lead to timely and profitable trades.
Even though momentum is a popular characteristic of stocks, it can be difficult to define. The debate over which best and worst metrics to focus on is a long one, but the Zacks Momentum Style Score, which is part of the Zacks Style Scores, helps us solve this problem.
Below we take a look California Water Service Group (CWT), a company that currently holds a Momentum Style Score of B. We also talk about price changes and revisions to earnings estimates, two of the main aspects of the Momentum Style Score.
It’s also important to note that Style Scores work as a complement to Zacks Rank, our stock rating system which has an impressive track record of outperformance. California Water Service Group currently has a Zacks rank of # 2 (Buy). Our research shows that stocks ranked Zacks Rank 1 (strong buy) and 2 (buy) and style A or B scores outperform the market over the following month period.
You can see the current list of Zacks # 1 ranking actions here >>>
Ready to beat the market?
In order to see if CWT is a promising dynamic choice, let’s take a look at some elements of the Momentum style to see if this water service holds up.
Looking at a stock’s short-term price activity is a great way to determine if it has momentum, as it can reflect both current interest in a stock and whether buyers or sellers have the upper hand. the moment. It is also useful to compare a title to its industry; it can show investors the best companies in a particular area.
For CWT, shares are up 2.42% over the past week, while industry Zacks Utility – Water Supply is up 2.29% over the same period. Stocks are also doing very well over a longer time frame, as the 6.64% monthly price change compares favorably with the industry’s 4.87% performance.
While any stock can see a price spike, it takes a real winner to consistently outperform the market. In the last quarter, shares of California Water Service Group rose 17.7% and 30.84% last year. In comparison, the S&P 500 was only up 6.55% and 29.68%, respectively.
Investors should also take note of CWT’s 20-day average trading volume. Volume is useful in many ways, and the 20-day average sets a good price / volume benchmark; a rising stock with above average volume is usually a bullish sign, while a falling stock with above average volume is usually bearish. CWT currently holds an average of 270,079 shares over the past 20 days.
The Zacks Momentum Style Score also takes into account trends in estimate revisions, in addition to price changes. Please note that estimate revision trends also remain at the heart of Zacks Rank. A nice track here can help be promising, and we’ve recently seen that with CWT.
Over the past two months, 1 profit estimate has increased compared to none lower for the entire year. These revisions helped raise CWT’s consensus estimate from $ 1.84 to $ 1.98 in the past 60 days. For the next fiscal year, 1 estimate has increased while there has been no downward revision during the same period.
Considering these factors, it shouldn’t come as a surprise that CWT is a # 2 (Buy) stock and has a Momentum Score of B. If you’re looking for a new pick that should skyrocket in the near term, be sure to keep California Water Service Group on your shortlist.
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California Water Service Group (CWT): Free Inventory Analysis Report
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