Looking at the past three months of U.S. sector performance, the Consumer Discretionary Select Sector SPDR Fund ETF has led the way, gaining an impressive 24 per cent, followed by Communication Services with a strong 19.4-per-cent return, Financials up 12.5 per cent, and Technology rising 8.9 per cent.
This week, we analyzed the top-performing sectors to identify U.S.-listed stocks with upward price and earnings momentum, supported by above-average TC growth factor ratings. Our focus was on stocks demonstrating robust quant-based metrics across these leading sectors.
We utilized Trading Central’s Strategy Builder to begin our process, setting a minimum market capitalization threshold of US$5-billion, narrowing the focus to mid- to large-cap stocks to avoid smaller, more volatile names.
Next, we screened for stocks demonstrating upside earnings momentum, requiring both EPS and revenue growth of at least 10 per cent in the most recent quarter compared with the same quarter a year earlier.
Finally, we filtered for top-rated stocks using Trading Central’s Quantamental rating system, which scores stocks on a scale of 0 to 100, with 100 being the most bullish. To refine the list further, we set a minimum requirement of 80 out of 100 for both growth and momentum factors, ensuring that only the highest-rated stocks from a quantitative perspective made the cut.
For informational purposes, we have also included the recent stock price, price-to-earnings ratio, four-week, year-to-date, and one-year price return.
Trading Central is a global leader in financial market research and investment analytics for retail online brokers and institutions. Its product suite provides actionable trading ideas based on technical and fundamental research covering stocks, exchange-traded funds, indexes, forex, options and commodities. Strategy Builder, our stock screener, is available through leading retail brokers in Canada and worldwide.
Stocks are ranked based on the average of all screening criteria selected.
Topping our list is AppLovin Corp., a software company specializing in mobile application development and monetization. AppLovin stands out because of its exceptional growth metrics and performance momentum. The company reported 38.6-per-cent revenue growth last quarter, coupled with a market cap of US$113.5-billion, demonstrating its robust presence in the industry. AppLovin also boasts a momentum factor rating of 96, the highest on our list, and a very strong growth factor rating of 92, the second-highest on our list, underscoring its potential for sustained performance. The stock has surged 772.1 per cent year-to-date and achieved an impressive 791.7 per cent one-year performance, making it the top-performing stock in this list from a price perspective. Its exceptional four-week performance of 19.1 per cent further highlights the continuing strength of its momentum.
Leading graphics chip maker NVIDIA has the highest market cap on our list at US$3.4-trillion. The company reported 93.6-per-cent revenue growth last quarter, driven by surging demand for AI-related hardware. The stock has very strong ratings in TC growth and momentum factors at 91 and 85, respectively.
Palantir Technologies Inc. is a leader in software and data analytics for government and commercial applications. Palantir booked revenue growth of 30 per cent last quarter and has a high momentum factor rating of 92. The stock has surged 337 per cent year-to-date. With a four-week advance of 19.5 per cent, Palantir continues to gain momentum as a major player in the software sector. Its ability to secure long-term contracts and innovate in AI-driven platforms cements its position as one of the top-performing stocks in our list.
Trading Central Strategy Builder provides a back-testing capability to evaluate how well an investing strategy would have worked in the past. Using a five-year historical period with quarterly rebalancing, the screen described had an impressive 22 per cent annualized total return compared to 14 per cent for the S&P 500 index.
The investment ideas presented here are for information only. They do not constitute advice or a recommendation by Trading Central in respect of the investment in financial instruments. Investors should conduct further research before investing.
Gary Christie is head of North American research at Trading Central in Ottawa.
