3 Momentum Stocks to Supercharge Your Portfolio in Q4
Are you looking to add some oomph to your portfolio performance? Well, you’re in luck. While the market has been on a roller coaster ride, some stocks have been steadily performing and building momentum. Momentum stocks allow you to ride the wave of its trajectory and push your portfolio to the next level. You may not be able to capture the beginning of the trend, but that’s okay. You’d want those who have already established an upward push and take advantage of its remaining trend as long as possible.
Now, how can you identify momentum stocks? The easiest way is to look at price performance. Look at companies performing well for a defined duration — week-to-date, month-to-date or year-to-date — depending on your investment period. Those looking for medium to long-term trends may want to use year-to-date (YTD) as a primary benchmark for performance. That lets you see the big picture, identifying which companies have been performing well since the start of the year. Like any strategy, momentum investing comes with risk, and it’s essential to consider your exit points in case the stock starts to turn. Still, the potential can be attractive. Let’s look at three momentum stocks worth checking out right now.
Crane NXT (CXT)
Crane NXT (NYSE:CXT) is an industrial technology company that offers various industrial solutions to its clients that help secure, authenticate and detect its customers’ significant assets. Crane NXT was a product of a split of its previous company, Crane Holdings, into Crane Company (NYSE:CR) and CXT. The company operates into two segments: Crane Currency, which offers security solutions using its proprietary technology that helps secure physical products like banknotes and consumer goods, and Crane Payment Innovations (CPI), which offers software and electronic equipment that provide detection and sensing technologies for payment transactions, verification and various solutions.
CXT is running on strong and stable momentum with a YTD return of 53%, backed by excellent financial performance in the last two quarters. Its latest earnings release beat analyst expectations by 21.74%, and net sales grew by 7% year-over-year (YoY). Crane NXT expects further growth with its ongoing customer demand and backlogs and has raised its adjusted EPS guidance from $3.75 to $4.05 up to between $3.85 and $4.15. These solid results and ongoing performance put CXT on our momentum stocks to buy list.
Verisk Analytics (VRSK)
Verisk Analytics (NASDAQ:VRSK) is a risk assessment and data analytics company that serves the insurance industry. Verisk leverages AI, machine learning and other advanced technologies to quickly analyze significant amounts of records to create analytics and insights that help its clients with risk management. VRSK operates in the industry’s property and casualty insurance segment by building and utilizing AI and machine-learning-centered models that help mitigate risk through standard and customized analytics. That enables fraud detection and management of weather and climate risks.
The company has been continuously building momentum throughout the year, with its YTD return of 34.6%, and is expected to grow more by the end of the year. VRSK has also raised its guidance for its full-year outlook based on its strong performance for the year’s first half. Based on its 2nd quarter report, consolidated revenues were up by 10.1%, diluted GAAP earnings by 8.9% and diluted adjusted EPS by 18.9%. The company also received a lot of positive buzz, from releasing a first-of-its-kind predictive SRCC model to launching its ClaimSearch system in Israel. These developments and outlook have earned VRSK a spot in our top momentum stocks to buy.
FleetCor Technologies (FLT)
FleetCor Technologies (NYSE:FLT) is a payment products company that operates in five principal segments categorized into two solutions. The first is Mobility and Vehicle, which allows its customers to monitor and control employee spending for fuel, tolls, lodging and complementary products. The second is Corporate Payments, which help simplify vendor payments through automation, virtual cards and travel & entertainment products. FLT’s products allow it to process an average of 1.7 billion transactions annually.
FleetCor has been on a roll these last few quarters, and it ended the 2nd quarter strong with a solid 10% revenue growth and 11% EBITDA growth. FLT also beat analyst expectations with its 7.86% EPS surprise. The company has also raised its full-year guidance, as it expects growth to continue till the end of the year. No wonder the stock is up 38% YTD.
Earlier this year, FLT acquired a stake in Mina, a cloud-based EV charging software platform that helps capture, calculate and pay for at-home commercial charging directly with the energy provider. That acquisition exposes FleetCor to the growing electric vehicle market in the U.K., giving the company an attractive and potentially significant revenue source in the future.
On the date of publication, Rick Orford did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
