Anatomy of Success: BlackRock (BLK) - Anatomy of Success

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Since 1988, stocks with a Zacks Rank #1 (Strong Buy) have generated an average annual return of over 26% a year, nearly tripling the S&P 500's 9.6% yearly average gain.

But our Zacks Rank #2s (Buys)have also outperformed the market with an impressive 18.4% average annual return, effectively doubling the benchmark.

While the list of #1s will be dominated by small and mid-cap stocks, you'll find a greater number of larger-cap stocks in the #2 list.


This is largely due to the extra difficulty a large-cap stock has in achieving a high score on the Agreement factor (one of the four factors that make up the Zacks Rank), which looks at the agreement of analysts making upward earnings estimate revisions. (The more analysts covering a stock, the harder it is to see a high percentage of analysts moving their estimates in the same direction.)

For many large-cap stocks, a Zacks Rank #2 can be just as important in signaling upcoming outperformance as a Zacks Rank #1 can be for a small-cap stock.

Keep reading to find out how to spot the best Zacks Rank #2s (Buys).

Blackrock ( BLK )

BlackRock is a large-cap stock in the Finance-Investment Management industry. They are one of the largest Investment Management firms in the US, providing products and services to both individual and institutional investors in the US and internationally.

For anyone looking for a good place to invest at the beginning 2013, they didn't have to look any further than BlackRock itself.

On January 4th, 2013, they garnered a Zacks Rank #2 (Buy), which signaled that BLK was ready to breakout to the upside.

And breakout they did. Starting at $218.03 when they first became a Buy, to $271.34 as of 5/3/13 (and still a Buy), BLK has increased by 24.5% (and still going).

During that time, their 12 Month Forward Earnings Estimate climbed from $15.04 to $16.66. Staying in on this run couldn't have been easier, as their earnings estimates literally increased each and every week for 17 weeks straight, providing all of the incentive needed to just sit back and watch the stock go.

Further reinforcement came within two weeks of getting in, with a positive EPS surprise of 5.88% on 1/17/13, and then again, 3 months later, with another 1.67% positive Surprise on 4/16/13.

BlackRock is a text book example of how a positive Zacks Rank and upward earnings estimate revisions can get you in on some of the best stocks on the move.

Fortunately, we see this happen over and over again when using the Zacks Rank as your guide. Not only on when to buy but also on when to sell.

Click here to see more Zacks Rank #1 and #2 stocks

Disclosure: Performance information for Zacks’ portfolios and strategies are available at: http://www.zacks.com/performance .



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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Stocks

Referenced Stocks: BLK

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