3 Under-Loved Growth Stocks For Your Portfolio

Sometimes in life, in fact more often than not, the best things tend to get overlooked when flanked by a plethora of mediocres. This phenomenon can be witnessed in stock investing too. Brokers sometimes fail to appreciate a few potential stocks amid an oversupply of average performers. These under-loved stocks can, at times, hold strong growth prospects.

Though a broker’s recommendation on a particular stock should not be relied upon blindly, one cannot also rule out the importance of such recommendations. The average of all brokerage recommendations on a stock definitely tells something about potential.

In fact, when the current average recommendation on a stock is bearish but the stock price continues to move higher, it implies that investors are somehow optimistic about the potential of the stock and not concerned about the brokers’ negative stance. Betting on these stocks could be a good strategy as the rally will attract more investors, leading to a further rise in its price. In addition, if the stock holds strong potential for growth, the rally is likely to sustain in the long run.
3 Under-Loved Stocks to Buy

We hereby zeroed in on three stocks that have average broker recommendation of #3 (Hold) or #4 (Sell) or #5 (Strong Sell), a Zacks Rank #1 (Strong Buy) or 2 (Buy), year-to-date price change of more than 10%, and a positive change in consensus EPS estimate for the current fiscal year over the past 4 weeks, a Growth Style Score ‘A’ or ‘B.’ (Click here to know about our style score system).

ANA Holdings Inc. (ALNPY - Snapshot Report)

This Tokyo-based airline transportation company offers scheduled & unscheduled air passenger as well as air courier services. Moreover, it provides services related to buying, selling, leasing, and maintenance of aircraft and related parts, apart from providing transportation ground support for aircraft.

Zacks Rank #2
Growth Score: B
Price Change (YTD): 15.23%
Change in F1 Estimate (4 Weeks): 16.67%
Current Average Broker Recommendation: 4

Envivio, Inc. (ENVI - Snapshot Report)

This San Francisco-based communication equipment firm provides software-based IP video processing and distribution solutions.

Rank: #2
Growth Score: A
Price Change (YTD): 202.99%
Change in F1 Estimate (4 Weeks): 16.67%
Current Average Broker Recommendation: 3

Hooker Furniture Corp. (HOFT - Snapshot Report)

This Martinsville, VA-based manufacturer and importer of residential furniture offers diversified products, consisting primarily of home office, entertainment centers and wall systems, across many style categories, in an upper-medium price range.

Rank: #1
Growth Score: A
Price Change (YTD): 47.12%
Change in F1 Estimate (4 Weeks): 11.11%
Current Average Broker Recommendation: 3

Bottom Line
The absence of a bullish broker outlook does not necessarily indicate underperformance of a stock. One should judge a stock’s inherent growth potential before freezing it out from the portfolio.
In other words, if you manage to find a stock which is not well acclaimed by brokers but still holds strong prospects, your chances of amassing profit from the stock’s price appreciation gets amplified.

Disclosure: Zacks.com contains statements and statistics that have ...

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