Betting on bargain stocks that have a low price-to-earnings (P/E) ratio is a convenient and common investment approach. The perception is that the lower the P/E, the higher is the value of the stock. This inference is drawn on the simple logic that a stock’s current market price does not justify (is not equivalent to) its higher earnings and therefore has room to run.
Naturally, there are very few investors who pay attention to stocks with an increasing P/E. But this often-overlooked trend can prove useful in finding great stocks. Let’s dig a little deeper.
Why Stocks with Rising P/E Can be Equally Hit
Investors should note that stock prices move in line with earnings performance. If earnings come in stronger, the price of a stock shoots up. Solid quarterly earnings and the forward guidance in turn boost earnings forecasts, leading to stronger demand for the stock and an uptrend in its price.
So, if share price is rising steadily, it means that investors are assured of the stock’s fundamental strength and expect some strong positives out of it. Also, studies have revealed that stocks have seen their P/E ratios jump over 100% from their breakout point in the cycle. So, if you can pick stocks early in their breakout cycle, you can end up seeing considerable gains.
Top 5 Low Price Stocks To Watch Right Now: Express-1 Expedited Solutions Inc.(XPO)
XPO Logistics, Inc. provides third-party logistics services using a network of relationships with ground, sea, and air carriers in the United States, Mexico, and Canada. It operates in three segments: Express-1, Concert Group Logistics, and Bounce Logistics. The Express-1 segment offers ground expedited surface transportation services for freight. It operates a fleet ranging from cargo vans to semi tractor trailer units. The Concert Group Logistics segment provides domestic and international freight forwarding services through a network of independently owned stations. Its domestic freight forwarding services include air charter, expedites, and time sensitive services, as well as cost sensitive services comprising deferred delivery, less than truckload, and full truck load services; and international freight forwarding services consist of on-board courier and air charters, time sensitive services, less-than-container and full-container-loads, and vessel charters. This segm ent also offers documentation on international shipments, customs clearance and banking, trade show shipment management, time definite and customized product distributions, reverse logistics and on site asset recovery projects, installation coordination, freight optimization, and diversity compliance support services. The Bounce Logistics segment provides premium freight brokerage services for truckload shipments. The company serves approximately 4,000 retail, commercial, manufacturing, and industrial customers through 6 U.S. operations centers and 22 agent locations. It offers its services to the automotive manufacturing, automotive components and supplies, commercial printing, durable goods manufacturing, pharmaceuticals, food and consumer products, and high tech sectors. The company was formerly known as Express-1 Expedited Solutions, Inc. and changed its name to XPO Logistics, Inc. in September 2011. XPO Logistics, Inc. was founded in 1989 and is based in Buchanan, Michi gan.
- [By ]
Breakups are a great way for companies to unlock a lot of value, Cramer reminded viewers. That's certainly been the case with XPO Logistics (XPO) – Get Report, which recently spun off GXO Logistics (GXO) – Get Report, and with the former L Brands, which split itself into Victoria's Secret (VSCO) – Get Report and Bath & Body Works (BBWI) – Get Report.
- [By Jeremy Bowman (TMFHobo)]
There’s a lot going on with XPO Logistics (NYSE:XPO) these days.
The transportation company just spun off its contract logistics division, GXO Logistics (NYSE:GXO), making it easier for investors to value the stock compared with less-than-truckload peers like Old Dominion and Saia. XPO also just posted record results in its second-quarter earnings report, showing the company is benefiting from the economic reopening.
- [By Lou Whiteman (TMFeldoubleu)]
With Motley Fool analyst Nick Sciple returning from his honeymoon, Motley Fool contributor Lou Whiteman joins this episode of Industry Focus: Energy to bring us up to speed on stories he might have missed in July, including Boeing (NYSE:BA), Lockheed Martin (NYSE:LMT), Tesla (NASDAQ:TSLA), and XPO Logistics’ (NYSE:XPO) earnings.
- [By Dan Caplinger]
Monday was an extremely strong day for the stock market, as major indexes finished well above where they started the session. Favorable economic data on retail sales renewed confidence that the U.S. economy continues to do well despite headwinds elsewhere around the world, and investors were pleased to see the U.S. and China discuss their respective currencies as part of their broader trade talks. Some benchmarks rose as much as 2%, but certain individual stocks saw even larger gains. NVIDIA (NASDAQ:NVDA), XPO Logistics (NYSE:XPO), and Infinera (NASDAQ:INFN) were among the top performers. Here’s why they did so well.
Top 5 Low Price Stocks To Watch Right Now: Doximity, Inc.(DOCS)
Doximity, Inc. operates a cloud-based digital platform for medical professionals in the United States. The company's cloud-based platform provides its members with tools built for medical professionals, enabling them to collaborate with their colleagues, coordinate patient care, conduct virtual patient visits, stay up-to-date with the latest medical news and research, and manage their careers. It primarily serves pharmaceutical companies and health systems. The company was formerly known as 3MD Communications, Inc. and changed its name to Doximity, Inc. in June 2010. Doximity, Inc. was incorporated in 2010 and is headquartered in San Francisco, California.
- [By James Brumley (TMFjbrumley)]
Shares of the social networking site for medical professionals Doximity (NYSE:DOCS) tumbled to the tune of 12.8% on Thursday, mostly in response to a downgrade from J.P. Morgan. Analyst Jackson Ader fears the big 250% run-up from its June IPO price of $26 per share has run its course, and then some.
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Another one of the top-performing IPOs of 2021 was Doximity Inc. (NYSE: DOCS). We said it was a “rare day-one buy” ahead of the IPO. We were correct, and it’s still one of the best new stocks on the market.
Top 5 Low Price Stocks To Watch Right Now: iShares Morningstar Large-Cap Growth (JKE)
iShares Morningstar Large-Cap Growth ETF, formerly iShares Morningstar Large Growth Index Fund (the Fund), is an exchange-traded fund. The Fund seeks investment results that correspond generally to the price and yield performance of the Morningstar Large Growth Index (the Growth Index). The Growth Index measures the performance of stocks issued by large-capitalization companies that have exhibited above-average growth characteristics as determined by Morningstar’s index methodology. The Fund invests in a representative sample of securities included in the Growth Index that collectively has an investment profile similar to the Growth Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Growth Index. The Fund’s investment advisor is BlackRock Fund Advisors, an indirect subsidiary of BlackRock, Inc.
- [By Ethan Ryder]
iShares Morningstar Large-Cap Growth ETF (NYSEARCA:JKE) declared a quarterly dividend on Thursday, September 27th, Wall Street Journal reports. Investors of record on Thursday, September 27th will be paid a dividend of 0.2522 per share on Tuesday, October 2nd. This represents a $1.01 dividend on an annualized basis and a dividend yield of 0.54%. The ex-dividend date is Wednesday, September 26th.
- [By Joseph Griffin]
iShares Morningstar Large Growth (NYSEARCA:JKE) declared a quarterly dividend on Tuesday, June 26th, Wall Street Journal reports. Investors of record on Wednesday, June 27th will be paid a dividend of 0.3796 per share on Monday, July 2nd. This represents a $1.52 annualized dividend and a yield of 0.87%. The ex-dividend date is Tuesday, June 26th. This is a boost from iShares Morningstar Large Growth’s previous quarterly dividend of $0.34.
Top 5 Low Price Stocks To Watch Right Now: Vanguard Short-Term Government ETF(VGSH)
Vanguard Short Term Government Bond ETF (the Fund) seeks to track the performance of a market-weighted government bond index with a short-term, dollar-weighted average maturity. The Fund employs a passive management or indexing investment approach designed to track the performance of the Barclays Capital U.S. 1-3 Year Government Float Adjusted Index (the Index). This Index includes fixed-income securities issued by the United States Treasury (not including inflation-protected securities) and the United States Government agencies and instrumentalities, as well as corporate or dollar-denominated foreign debt guaranteed by the United States Government, all with maturities between 1 and 3 years. The Fund invests by sampling the Index, meaning that it holds a range of securities that, in the aggregate, approximates the full Index in terms of key risk factors and other characteristics. The Fund’s investment advisor is Vanguard Fixed Income Group. Advisors’ Opinion:
- [By Stephan Byrd]
ILLEGAL ACTIVITY WARNING: “NEXT Financial Group Inc Acquires Shares of 2,069 Vanguard Short-Term Government Bond ETF (VGSH)” was first posted by Ticker Report and is the property of of Ticker Report. If you are accessing this piece of content on another domain, it was illegally copied and republished in violation of United States and international trademark and copyright law. The correct version of this piece of content can be read at www.tickerreport.com/banking-finance/4203155/next-financial-group-inc-acquires-shares-of-2069-vanguard-short-term-government-bond-etf-vgsh.html.
- [By Logan Wallace]
FDx Advisors Inc. bought a new stake in Vanguard Short-Term Government Bond ETF (NASDAQ:VGSH) during the 2nd quarter, according to its most recent filing with the Securities and Exchange Commission (SEC). The institutional investor bought 24,799 shares of the company’s stock, valued at approximately $1,486,000.
- [By Jason Hall]
Here’s the same chart, with the Vanguard Short-Term Govt Bond ETF (NASDAQ:VGSH) added for context. While the Total Bond Market fund invests in both long- and short-term funds, the Short-Term Government Bond ETF maintains a dollar-weighted average maturity between one and three years. This reduces the fund’s exposure to day-to-day price volatility:
- [By Joseph Griffin]
News stories about Vanguard Short-Term Treasury Index Fund (NASDAQ:VGSH) have trended somewhat positive this week, Accern Sentiment Analysis reports. The research group scores the sentiment of news coverage by monitoring more than 20 million news and blog sources in real-time. Accern ranks coverage of publicly-traded companies on a scale of -1 to 1, with scores nearest to one being the most favorable. Vanguard Short-Term Treasury Index Fund earned a media sentiment score of 0.19 on Accern’s scale. Accern also gave press coverage about the company an impact score of 47.214477788243 out of 100, indicating that recent news coverage is somewhat unlikely to have an effect on the stock’s share price in the near future.
Top 5 Low Price Stocks To Watch Right Now: Winnebago Industries Inc.(WGO)
Winnebago Industries, Inc. manufactures and sells recreation vehicles primarily for leisure travel and outdoor recreation activities. The company offers motor homes, which are self-propelled mobile dwellings that provide living accommodations for approximately seven persons and include kitchen, dining, sleeping, and bath areas, as well as a lounge; and optional equipment accessories, such as generators, home theater systems, king-size beds, upholstery, and interior equipment. It manufactures motor homes constructed directly on medium- and heavy-duty truck chassis, which include engine and drivetrain components; and on van-type chassis onto which the motor home manufacturer constructs a living area with access to the driver’s compartment under the Winnebago and Itasca brand names, as well as panel-type vans with sleeping, kitchen, and/or toilet facilities under the Era brand name. The company also produces original equipment manufacturing parts, including extruded aluminum and other component products for other manufacturers and commercial vehicles. Winnebago Industries markets its motor homes through independent dealers primarily in the United States and Canada. The company was founded in 1958 and is headquartered in Forest City, Iowa.
- [By Motley Fool Transcribing]
Winnebago Industries (NYSE:WGO) Q2 2019 Earnings Conference CallMarch 25, 2019 10:00 a.m. ET
Prepared Remarks Questions and Answers Call Participants
- [By Max Byerly]
Winnebago Industries, Inc. (NYSE:WGO) – Investment analysts at SunTrust Banks lowered their Q2 2019 EPS estimates for shares of Winnebago Industries in a research note issued on Tuesday, February 5th. SunTrust Banks analyst M. Swartz now expects that the construction company will post earnings of $0.65 per share for the quarter, down from their prior forecast of $0.67. SunTrust Banks currently has a “Positive” rating and a $34.00 target price on the stock. SunTrust Banks also issued estimates for Winnebago Industries’ FY2019 earnings at $3.70 EPS and FY2020 earnings at $4.15 EPS.
- [By Demitrios Kalogeropoulos]
The RV industry is in its ninth consecutive year of expansion, and that growth has helped Winnebago (NYSE:WGO) establish significantly stronger operating trends lately. On top of that success, management made a timely acquisition of a rival last year, and the acquisition has allowed the RV specialist to fill out its portfolio while boosting profit margins to new highs.
- [By Rich Duprey, George Budwell, and Neha Chamaria]
We asked three Motley Fool contributors to identify a small-cap stock that they believed could outperform the market and would make a good buy this month. Check out why Greenbrier (NYSE:GBX), Novavax (NASDAQ:NVAX), and Winnebago (NYSE:WGO) made the cut.