For Immediate Release
Chicago, IL - May 11, 2016 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Delta Apparel Inc. ( DLA ), Fresh Del Monte Produce Inc. ( FDP ), AMN Healthcare Services Inc. ( AHS ), KT Corp. ( KT ) and HFF, Inc. ( HF ).
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Here are highlights from Tuesday's Analyst Blog:
5 Stocks Backs by Increasing Cash Flows to Buy Now
Crunching profit numbers and evaluating surprises might seem appropriate right after an earnings season but these do not ensure that the profits are being efficiently channeled to the reserves to fund future growth. Because, even a profit-making company can have a deficiency of cash flow and might go bankrupt while meeting its obligations.
Therefore, to ensure investing in the right stocks, one must look at a company's proficiency in generating cash flows. This is because cash is indeed the lifeblood of any business. Its gives a company the flexibility to make decisions, the means to make potential investments and the fuel to run the growth engine. Cash also shields a company from market turmoil.
Cash moves in and out of any business, but it is net cash flow that shows how much money the company is actually generating. A positive cash flow indicates an increase in the company's liquid assets. This gives the company the means to settle debt, shell out for its expenses, reinvest in its business, endure downturns and finally pay back its shareholders. On the other hand, a negative cash flow implies a decline in the company's liquidity, which in turn lowers its flexibility to support these moves.
A company can competently grow only when this positive cash flow is rising, as increasing cash flow indicates management's efficiency in generating more cash from its business.
Therefore, for picking stocks don't go for profits only. Make sure to look for stocks with dependable and increasing cash flows.
Screening Parameters :
To find out stocks that have seen increasing cash flow over time, we ran the screen for stocks whose cash flow in the latest reported quarter is at least equal to or greater than the 5-year average cash flow per common share . This implies a positive trend and increasing cash over a period of time.
In addition to this, we chose:
Zacks Rank 1: No matter whether the market conditions are good or bad, stocks with a Zacks Rank #1 (Strong Buy) have a proven history of outperformance.
Average Broker Rating 1: This indicates that brokers are also highly hopeful about the company's future performance.
Current Price greater than or equal to $5 : This screens out the low priced stocks.
VGM Scoreof B or better: This score is also of great assistance in selecting stocks. Importantly, this scoring system helps in picking the winning stocks in their respective industry categories.
Here are five out of 12 stocks that made it through the screen:
Delta Apparel Inc. ( DLA )
Fresh Del Monte Produce Inc. ( FDP )
AMN Healthcare Services Inc. ( AHS )
KT Corp. ( KT )
HFF, Inc. ( HF )
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
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About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
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