The Zacks Rank: A Proven System with a Quirky Twist
Here at Zacks, we take our stock picking seriously. But that doesn’t mean we can’t have a little fun along the way! Our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. But we’re also always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
The Zacks Rank: A Deep Dive
The Zacks Rank is a proprietary stock selection model that rates stocks based on recent earnings estimate revisions. It ranks stocks into five categories: Strong Buy, Buy, Hold, Sell, and Strong Sell. The rankings are based on a 1-5 scale, with Strong Buys and Buys having a rank of 1 or 2, and Sells and Strong Sells having a rank of 5.
The Zacks Rank is calculated using a formula that takes into account the most recent changes in earnings estimates from analysts covering the stock. The more positive the earnings estimate revisions, the higher the Zacks Rank.
Value, Growth, and Momentum: Adding Color to the Rank
But the Zacks Rank isn’t just about earnings estimates. We also consider other factors to help us identify stocks that are poised for success. For value investors, we have the Value Score, which ranks stocks based on their valuation multiples, such as price-to-earnings and price-to-sales ratios. For growth investors, we have the Growth Score, which looks at factors such as revenue growth and earnings growth.
And for those who are drawn to momentum stocks, we have the Momentum Score, which identifies stocks that have recently outperformed their peers. By combining the Zacks Rank with these additional scores, we can provide a more comprehensive view of a stock’s potential.
How the Zacks Rank Affects You
As an individual investor, the Zacks Rank can help you make informed decisions about which stocks to add to your portfolio. By focusing on stocks with a Strong Buy or Buy ranking, you can increase your chances of finding winners. And by also considering the Value, Growth, and Momentum scores, you can fine-tune your investments to align with your investment style.
How the Zacks Rank Affects the World
But the impact of the Zacks Rank isn’t just limited to individual investors. Institutions, mutual funds, and other professional investors also use the Zacks Rank to help guide their investment decisions. And as more and more investors follow the Zacks Rank, it can help shape market trends and influence stock prices.
Conclusion: A Proven System with a Personal Touch
At Zacks, we believe that stock picking doesn’t have to be a bland, impersonal process. With the Zacks Rank and our additional scores, we can provide you with a comprehensive view of a stock’s potential, all while keeping things light and approachable. So whether you’re a seasoned investor or just starting out, join us on this quirky, value-packed journey to finding great stocks!
- The Zacks Rank is a stock selection model that emphasizes earnings estimate revisions
- It ranks stocks into five categories: Strong Buy, Buy, Hold, Sell, and Strong Sell
- Additional scores for Value, Growth, and Momentum help fine-tune investments
- Individual investors can use the Zacks Rank to make informed decisions
- Institutions and professional investors also use the Zacks Rank to guide decisions
