The stock market is ending the year on a bullish note. This momentum is likely to continue into 2021 given the stimulus, vaccine, and improving economic data.The POWR Ratings can help you find the best candidates for outperformance. It shows the industries that are outperforming from a fundamental and technical perspective.
Let’s take a look at four of the more intriguing POWR Rating upgrades: Adobe (ADBE), Rockwell Automation (ROK), Copart (CPRT), and Rollins (ROL).
There is a good chance you or your employer uses at least one ADBE product or service. The company’s mobile software and services are used by professionals in just about every line of business. As one of the globe’s largest software developers, ADBE generates revenue through customer licensing fees in addition to other streams.
The POWR Ratings show ADBE has "A" grades in the Buy & Hold Grade and Trade Grade components along with a Software - Application category rank of 2nd out of nearly 100 stocks. ADBE has a year-to-date price return of 51.73% along with a six-month price return of 15.92% and a three-year price return of 185.95%. The analysts insist ADBE is underpriced, setting an average price target of $575 for the stock, indicating there is more than 15% upside to go. Of the eight analysts who have studied the stock, every single one of them recommends buying it.
ADBE soared all the way up to $533 in the late summer. The stock dipped down below $450 and is now moving right back up to its summer high. ADBE has acquired Workfront, a management platform specialist, for more than a billion dollars. The bottom line is ADBE has a sufficiently diversified business with a lengthy track record of success and will be able to hold steady even if the economy sours.
Rockwell Automation (ROK)
ROK’s information solutions and industrial automation are used by businesses in 100+ countries. Slightly more than half of ROK’s aggregate sales stem from the United States. The company’s main operating segments are architecture & software and control products & solutions.
ROK has an "A" grade in the Buy & Hold Grade and Trade Grade components. ROK is ranked 6th of 62 stocks in the Industrial - Machinery category. The stock has a year-to-date price return of 25.62% along with a six-month price return of 22.88% and a three-year price return of 36.67%.
ROK recently teamed up with the industrial software provider PTC to put its manufacturing on the fast-track. While ROK's manufacturing execution systems are a solution at the factory level, PTC's SaaS solutions are applicable enterprise-wide. The partnership will prove mutually beneficial to both businesses.
ROK is clearly benefitting from reshoring stemming from conflicts with China. Furthermore, the pandemic has heightened and hastened the need for digital transformation and industrial automation technology, directly benefitting ROK.
CPRT services are used by insurance companies and vehicle suppliers to process salvage vehicles and sell them online. These sales are conducted through CPRT’s Virtual Bidding Second Generation web auctions. Furthermore, CPRT provides extensive remarketing services to boot.
CPRT customers include sellers such as banks, insurers, and car dealerships. The company’s buyers range from auto dealerships to vehicle rebuilders and members of the public. The POWR Ratings reveal CPRT has an "A" grade in the Buy & Hold Grade and Trade Grade components. CPRT is ranked first of 16 stocks in the Auto Dealers & Rentals category.
CPRT has a year-to-date price return of 34.12%, a six-month price return of 50.01%, and a three-year price return of 181.36%. Look for CPRT to continue its trend of outperforming as the economy picks up steam.
ROL, a pest control service provider, protects against all sorts of unwelcome insects and rodents to those who live and work in homes and businesses. A considerable number of ROL customers are in the foodservice and hospitality industry. ROL also sells products about sanitation and pest management. Furthermore, the company provides specialized services to businesses in oil, gas, and mining.
ROL has an "A" grade in the Industry Rank, Buy & Hold Grade, and Trade Grade components. ROL is ranked 4th of 57 publicly traded stocks in the Outsourcing - Business Services category. The stock has a year-to-date price return of 82% and a six-month price return of 46%. ROL has a three-year price return of 100%.Look for ROL to move back toward its November high of $42 and change as people continue to pay for pest control despite the pandemic.
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ADBE shares were trading at $499.77 per share on Tuesday morning, up $1.38 (+0.28%). Year-to-date, ADBE has gained 51.53%, versus a 15.85% rise in the benchmark S&P 500 index during the same period.
About the Author: Patrick Ryan
Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management.4 Upgraded Stocks to Buy Before the New Year appeared first on StockNews.com