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Zacks.com featured highlights: Cherokee, Autobytel, Alpha and Omega Semiconductor, Renewable Energy Group and SolarEdge Technologies

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For Immediate Release

Chicago, IL - May 19, 2017 - Stocks in this week's article include Cherokee Inc. (NASDAQ: CHKE - Free Report ), Autobytel Inc. (NASDAQ: ABTL - Free Report ), Alpha and Omega Semiconductor Limited (NASDAQ: AOSL - Free Report ), Renewable Energy Group, Inc. (NASDAQ: REGI - Free Report ) and SolarEdge Technologies, Inc. (NASDAQ: SEDG - Free Report ).

Screen of the Week of Zacks Investment Research:

5 Top-Ranked Breakout Stocks Offering Formidable Returns

Seeking out breakout stocks is probably one of the most-favored techniques among active investors. The logic behind this kind of stock selection is to determine those are trading within a narrow band. These stocks are to be bought as soon as they move above this channel and sold when they fall below. In case a stock moves above this band, it usually gains momentum.

At the same time, market watchers warn against incorrectly timing such a move. This is because there is a significant risk of identifying stock movements as breakouts even when this is not the case. However, when utilized judiciously, this strategy yields formidable gains, which is the reason why it remains popular.

Zeroing in on Breakout Stocks

In order to select the right breakout stock one has to first calculate its support and resistance level. A support level is the lower bound for stock movements while a resistance level refers to the maximum price which it trades within over a considerable period.

In other words, the demand for a stock is at its lowest at its support level, which means most traders are willing to sell it. At the resistance level, most traders are willing to go long on the stock, which means that they would like to add them to their portfolios. The key to identifying breakout stocks is to zero in on those that are on the verge of a breakout or those that have just broken above the resistance level.

Has a Breakout Really Occurred?

The central risk which accompanies such a strategy is that the decision to buy an apparent breakout candidate has been incorrectly timed. When a stock moves above the resistance level, it should be a highly prized commodity for traders. However, whether such a breakout is at all genuine is another matter altogether.

For breakout to actually happen, the stock's earlier resistance barrier should become its new support level. This only happens if the trading channel that has been established is tested by observing long-term price trends. The strength of the support and resistance levels can be ascertained only through such a study. Despite the risk of misidentification, correctly identifying such stocks can yield considerable returns, even at a price which may not seem attractive at first glance.

Screening Parameters

Percentageprice change over four weeks between 10% and 20% (Stocks which are showing considerable price increases, but whose gains are not excessive.)

Current Price /52-Week High greater than or equal to 0.9 (Stocks which are trading 90% close to their 52-week highs.)

Zacks Rank equal to #1 (Only Strong Buy stocks can get through. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .)

Beta for 60 months less than or equal to 2

(Stocks which move by a greater degree than the broader market but within a reasonable limit.)

Current price less than or equal to $20 (Stocks which are reasonably priced.)

These criteria narrow down the universe of over 7892 stocks to only 6.

Here are the top five stocks that meet these criteria:

Cherokee Inc. (NASDAQ: CHKE - Free Report ) is a marketer and licensor of Cherokee and Sideout brand products, is continuing its negotiations for domestic and international licensing contracts covering multiple categories of merchandise. Cherokee's average EPS surprise over the last four quarters 165.7%.

Autobytel Inc. (NASDAQ: ABTL - Free Report ) is an internationally branded online automotive commerce company that provides consumers with automotive solutions throughout the lifecycle of vehicle ownership. Avid Technology's average EPS surprise over the last four quarters is 42%.

Alpha and Omega Semiconductor Limited (NASDAQ: AOSL - Free Report ) is engaged in designing, developing and supplying a broad range of power semiconductors globally, including a portfolio of Power MOSFET and Power IC products. Alpha and Omega Semiconductor's average EPS surprise over the last four quarters is 272.5%.

Renewable Energy Group, Inc. (NASDAQ: REGI - Free Report ) is a biodiesel manufacturer and marketer. Its average EPS surprise over the last four quarters is 13.4%.

SolarEdge Technologies, Inc. (NASDAQ: SEDG - Free Report ) provides inverter solutions for solar photovoltaic installations. SolarEdge Technologies' EPS surprise over the last four quarters is 13.3%.

You can get the rest of the stocks meeting these criteria 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 backtest them first before taking the investment plunge.

The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.

Click here to sign up for a free trial to the Research Wizard today .

Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

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

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Sign up now for your free trial today and start picking better stocks immediately. And with the backtesting feature, you can test your ideas to see how you can improve your trading in both up markets and down markets. Don't wait for the market to get better before you decide to do better. Start learning how to be a better trader today: https://at.zacks.com/?id=111

Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

About Screen of the Week

Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use. Each week, Zacks Profit from the Pros free email newsletter shares a new screening strategy. Learn more about it here https://at.zacks.com/?id=112

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Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Click here for your free subscription to Profit from the Pros .

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.

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Cherokee Inc. (CHKE): Free Stock Analysis Report

Autobytel Inc. (ABTL): Free Stock Analysis Report

Alpha and Omega Semiconductor Limited (AOSL): Free Stock Analysis Report

Renewable Energy Group, Inc. (REGI): Free Stock Analysis Report

SolarEdge Technologies, Inc. (SEDG): Free Stock Analysis Report

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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 Nasdaq, Inc.


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

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