Zacks Buy List Highlights: Monsanto Company, Airgas, Inc., The GEO Group, Inc. and Oil States International, Inc.
June 27, 2007 at 09:58 AM EDT
Zacks.com releases the latest list of Zacks Rank Buy Stocks. Everyday on Zacks.com, four stocks are selected based on how well they match the criteria for the four main schools of investing: Aggressive Growth, Growth & Income, Momentum and Value. The four Zacks Rank Buy stocks highlighted today are Monsanto Company (NYSE: MON), Airgas, Inc. (NYSE: ARG), The GEO Group, Inc. (NYSE: GEO), and Oil States International, Inc. (NYSE: OIS).
Stocks ranked #1 (Strong Buy) by Zacks have produced an average annual return of +31.9% since inception in 1988. During the 2000-2002 bear market, Zacks #1 Rank stocks gained 43.8% while the S&P 500 tumbled -37.6%. To see the full Zacks #1 Rank (Strong Buy) List, or the rank for any other stock, visit: http://at.zacks.com/?id=88
Here is a synopsis of today’s Zacks Rank Buy Stocks:
Aggressive Growth – Monsanto Company (NYSE: MON)
Monsanto is a company in the right spot at the right time. Surging corn prices have allowed it to beat earnings estimates in seven out of the past eight quarters. Five analysts have raised their estimates for this year. This year's estimates have jumped 21 cents to $1.81 per share over the past 90 days. The stock has an ROE of 12%, above the industry average of 7%.
Growth & Income – Airgas, Inc. (NYSE: ARG)
Airgas, Inc., which was last presented as a Growth & Income pick on Dec 1, exceeded analysts’ earnings expectations for eight consecutive quarters. The company recently raised its first-quarter profit guidance to between 61 cents and 63 cents per share. As a result of ARG’s bullish guidance, analysts have been upping their earnings estimates. On May 8, the Board of Directors increased the company’s quarterly cash dividend to nine cents per share from seven cents.
Momentum – The GEO Group, Inc. (NYSE: GEO)
On May 1, The GEO Group, Inc. reported first-quarter earnings of 22 cents per share, up from 16 cents last year and two cents above expectations. Looking forward, the company increased its full-year 2007 profit forecast to between $2.02 and $2.15 per share, up from prior guidance of $1.96 to $2.11. The stock is currently trading at record highs, above the 21-day, 50-day and 200-day moving averages.
Value – Oil States International, Inc. (NYSE: OIS)
Oil States International, Inc., a Zacks #1 Rank stock, topped the Street’s earnings estimate for nine straight quarters by an average margin of 15.3%. Consensus earnings estimates for both this year and next are up over the past week. OIS has a price-to-book ratio of 2.3, compared to 4.5 for the market and 4.1 for the industry. Its return on equity surpasses that of the industry average—24% compared to 22%.
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About the Zacks Rank
Since 1988, the Zacks Rank has proven that "Earnings estimate revisions are the most powerful force impacting stock prices." Since inception in 1988, #1 Rank stocks have generated an average annual return of +31.9%. During the 2000-2002 bear market, Zacks #1 Rank stocks gained +43.8%, while the S&P 500 tumbled -37.6%. Also note that the Zacks Rank system has just as many Strong Sell recommendations (Rank #5) as Strong Buy recommendations (Rank #1). Since 1988, Zacks Rank #5 stocks have underperformed the S&P 500 by 132% annually (+5.1% vs. +11.9%). Thus, the Zacks Rank system allows investors to truly manage portfolio trading effectively.
Zacks Rank performance is the total return (price changes + dividends) of equal weighted portfolios, consisting of those stocks with the indicated Zacks Rank, assuming zero transaction costs. These returns are not the result of a backtest; these are actual returns since 1988. The stocks in the Zacks Rank portfolios were available to Zacks clients before the beginning of each month (monthly rebalancing). Performance results from 1988 through September 2006 are based on a subset of all Zacks Rank stocks that excludes stocks covered by only one analyst and ADR’s.
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