While “the trend is your friend” when it comes to short-term investing or trading, the timing of entering the trend is a key determinant of success. And increasing the chances of success by making sure that the sustainability of a trend is not easy.
The trend often reverses before the trade is exited, leading to a short-term loss of capital for investors. So, for a profitable trade, factors such as sound fundamentals, positive earnings estimate revisions, etc. should be confirmed. that can keep the stock’s momentum alive.
Our “Recent Price Strength” screen, which is built into a unique short-term trading strategy, can be quite helpful in this regard. This default screen makes it really easy to select stocks that have enough fundamental strength to maintain their recent uptrend. Also, the screen only passes stocks that are trading at the top of their 52-week high-low range, which is usually a bullish indicator.
Ardelix (ARDX) is one of several suitable candidates that made it to the screen. Here are the main reasons why it can be a profitable bet for “trend” investors.
A solid price increase over a 12-week period reflects investors’ continued willingness to pay more for a stock’s potential growth. ARDX is quite suitable in this regard, gaining 130% during this period.
However, it is not enough to look at the price change over about three months, as it does not reflect any trend changes that may have occurred in a shorter time frame. It is important for a potential winner to maintain the price trend. A price increase of 6.3% over the past four weeks ensures that the trend is still in place for this biotech company’s stock.
Additionally, ARDX is currently trading at 96.1% of its 52-week high-low range, hinting that it may be on the verge of a breakout.
Looking at the fundamentals, the stock currently carries a Zacks Rank #2 (Buy), meaning it is in the top 20% of the more than 4,000 stocks we rank based on trends in earnings estimate revisions and EPS surprises – – key factors that affect the short-term price movements of a share.
The Zacks Rank stock rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell) , has an impressive externally audited footprint. record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the full list of today’s Zacks Rank #1 (Strong Buy) stocks here >>>>
Another factor that confirms the company’s fundamental strength is its Average Broker Recommendation of #1 (Strong Buy). This indicates that the brokerage community is very optimistic about the short-term stock price performance.
So the price trend in ARDX may not reverse anytime soon.
In addition to ARDX, there are several other stocks that currently make it through our “Recent Price Strength” screen. You can consider investing in them and start searching for the newest stocks that fit these criteria.
This isn’t the only screen that can help you find your next winning stock pick. Based on your personal investment style, you can choose from over 45 Zacks Premium Screens that are strategically designed to beat the market.
However, keep in mind that the key to a successful stock picking strategy is to ensure that it has produced profitable results in the past. You can easily do this with the help of Zacks Research Wizard. In addition to allowing you to test the effectiveness of your strategy, the program comes loaded with some of our most successful stock picking strategies.
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Ardelyx, Inc. (ARDX): Free Stock Analysis Report
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