This month’s First Cut highlights stocks earning strong AAII A+ Investor Grades across all five factors: value, growth, momentum, earnings estimate revisions (and surprises) and quality. Each grade reflects how a stock ranks relative to all other companies. To receive a grade, a company must have sufficient data for meaningful comparison. For example, the Value Grade considers up to six valuation metrics, but a company must have data for at least two of these metrics to qualify. See the Stock Strategies article in this issue for more on the A+ Grades.

As of February 13, our stock universe included 6,676 companies, of which 4,782 had Value Grades, 5,397 had Growth Grades, 6,160 had Momentum Grades, 3,613 had Earnings Estimate Revisions Grades and 6,644 had Quality Grades. Companies may receive a Value Grade, but those without analyst coverage will not receive an Earnings Estimate Revisions Grade. All five grades were available for 2,934 companies; 1,423 of these companies had grades of D or better across all five factors, and 293 had grades of C or better.

The 31 companies earning grades of B or better across all five factors made this month’s First Cut. Companies showing strength across the factors may warrant closer attention as investors look for opportunities supported by both fundamentals and market momentum. Strattec Security Corp. (STRT) is the only company that currently has a grade of A for all five factors.

The stocks are ranked by their relative price strength over the last 52 weeks. The forward price-earnings (P/E) ratio—price divided by the consensus earnings per share estimate for the current fiscal year—provides some additional color on the valuations of the passing companies, while the historical sales and earnings growth rates reveal the recent strength of both top- and bottom-line growth. 

Related

Feature

How the Components of A+ Grades Help You Analyze Stocks

AAII How-To

Your Guide to the New AAII Investor Hub

AAII How-To

The Eight Metrics AAII Uses to Identify Quality Stocks