Zacks.com announces the latest list of top performing Zacks #1 Rank (“strong buy”) stocks. The stocks on the prestigious list with the highest returns last week were Somanetics Corporation (NASDAQ: SMTS), GMX Resources, Inc. (NASDAQ: GMXR), America’s Car-Mart, Inc. (NASDAQ: CRMT), The9 Limited (NASDAQ: NCTY) and Penn Virginia Corporation (NYSE: PVA). Each of these stocks easily outperformed the S&P 500.
Stocks ranked #1 (Strong Buy) by Zacks have produced an average annual return of +32% since inception in 1988. During the 2000-2002 bear market, Zacks #1 Rank stocks gained 43.8% while the S&P 500 tumbled 37.6%. To learn more about the Zacks Rank, go to http://at.zacks.com/?id=3172.
Here is a synopsis of the last week’s best performing Zacks #1 Rank stocks.
Somanetics Corporation (NASDAQ: SMTS) was able to put together a double-digit gain during a tough, holiday-shortened week. Shares of the medical device manufacturer advanced approximately 13.2% for the week ended Jul 3. On Jul 1, SMTS announced that its Board authorized an increase in its share repurchase program of up to $15 million, bringing the total to $45 million of its common shares.
Earnings estimates for this fiscal year are up 9.2% in the past month while expectations for its fiscal third quarter are up 11.1% in that time. SMTS reported a solid fiscal second quarter in mid June, which included net revenues that jumped 40% to $12.7 million from $9.1 million a year earlier. Meanwhile, earnings per share of 21 cents advanced from last year’s 17 cents and beat the consensus by more than 31%. The company also reaffirmed its guidance for fiscal 2008.
Earnings estimates for GMX Resources, Inc. (NASDAQ: GMXR) continue to move in the right direction, including an advance of 1% for this year in the past seven trading days. Analysts have boosted expectations by almost 51% over the past two months. Last week, shares moved forward by 8.5%. GMXR – a 'Pure Play' exploration and production company – has made the Zacks #1 Rank Top Performers List several times in the past few weeks, most recently for the week ended June 20.
Last month, GMXR announced a pair of agreements to purchase land in Harrison County, East Texas and Caddo Parish North Louisiana. The company called the acquisitions a significant growth opportunity, especially as it prepares its accelerated drilling plans for the 'Haynesville'/Bossier Shale. In May, GMXR posted earnings per share of 40 cents for its first quarter, which was ahead of the consensus by about 21.2%. The company also raised its guidance for 2008 revenue, total production and cash flow, along with its capital expenditure budget.
America’s Car-Mart, Inc. (NASDAQ: CRMT) moved forward by 8% last week, which was enough to make the Zacks #1 Rank Top Performers List. Earnings estimates for this fiscal year, which ends in April 2009, are up 15.7% in the past month.
CRMT, which was recently added to the Russell 3000 Index, blew the doors of its fiscal fourth-quarter expectations in late June. Earnings per share of 51 cents trounced the consensus by more than 82% and easily exceeding the year-ago performance. Revenue jumped 29.1% to $76.5 million from $59.3 million. While not immune from the current troubles in the economy, CRMT said that it’s not as affected as others since it sells basic transportation and extends credit in markets with no real public transportation alternative.
The9 Limited (NASDAQ: NCTY), a leading online game operator in China, advanced approximately 4.4% for the week ended Jul 3, marking a solid performance given the otherwise struggling market. Earnings estimates for this year have been trending upward for a while now, including gains of about 32% over the past two months and 3.6% over the past 30 days.
In May, NCTY reported strong numbers for its first quarter, including earnings per share of US46 cents, which topped the consensus by more than 48%. It also marked a solid advance from the previous year. Net revenues reached US$62.7 million, which was up 63% from the prior year and 4% from the prior quarter. According to the company, the quarter’s financial results were achieved on back of resilient growth of Blizzard Entertainment®’s World of Warcraft®.
Penn Virginia Corporation (NYSE: PVA), which gained 3.4% last week, is one of several companies drilling in the newly-popular and potentially-lucrative Haynesville Shale – a natural gas play on the border of Louisiana and Texas. Over the past two months, earnings estimates for this year moved higher by approximately 18.5%, including a rise of 6.7% in the past 30 days.
In late May, PVA announced horizontal drilling success with its Haynesville Shale test well in Harrison County, Texas. The well’s initial production rate was approximately 8.0 million cubic feet of natural gas (MMcf) per day. The company expects the well to produce at an initial rate between 10 and 15 MMcf per day.
About the Zacks Rank
Since 1988, the Zacks Rank has proven that "Earnings estimate revisions are the most powerful force impacting stock prices." Since inception in 1988, #1 Rank stocks have generated an average annual return of +32%. During the 2000-2002 bear market, Zacks #1 Rank stocks gained +43.8%, while the S&P 500 tumbled -37.6%. Also note that the Zacks Rank system has just as many Strong Sell recommendations (Rank #5) as Strong Buy recommendations (Rank #1). Since 1988, Zacks Rank #5 stocks have underperformed the S&P 500 by 129% annually (+5 % vs. +12%). Thus, the Zacks Rank system allows investors to truly manage portfolio trading effectively.
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Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
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