Core Viewpoint - The article discusses the 11 best stocks to invest in through a Roth IRA, emphasizing the importance of selecting the right stocks for long-term wealth creation in an uncertain economic environment [1][4]. Investment Strategy - A Roth IRA allows for tax-free investment growth and withdrawals, making it a powerful tool for long-term wealth creation, especially for individuals aged 35 to 60 [2]. - The selection of stocks for a Roth IRA is crucial, particularly in light of recent market volatility and economic uncertainty [3]. Market Context - On September 5, 2025, major market indexes experienced declines following a weaker-than-expected jobs report, raising concerns about economic growth [3]. - The S&P 500 fell by 0.32%, the Dow decreased by 220 points, and the Nasdaq dropped by 0.03%, despite reaching record intraday highs earlier in the session [3]. Methodology for Stock Selection - The list of the 11 best Roth IRA stocks was curated based on long-term growth catalysts, dividend growth history, solid business fundamentals, and positive analyst coverage [6]. - Hedge fund sentiment was assessed using Insider Monkey's hedge fund database, which tracks over 1,000 hedge funds, ranking stocks based on the number of hedge funds holding stakes as of Q2 2025 [6][7]. Featured Stocks - **NextEra Energy, Inc. (NYSE:NEE)**: - Number of Hedge Fund Holders: 66 - Goldman Sachs reaffirmed a 'Buy' rating with a price target of $91.00, highlighting the company's strong regulatory navigation and gradual rate increases [9][10][11]. - **Honeywell International Inc. (NASDAQ:HON)**: - Number of Hedge Fund Holders: 67 - Announced a $600 million equity capital raise for its quantum subsidiary, Quantinuum, valuing it at $10 billion pre-money, aimed at accelerating the development of next-generation quantum computing [13][14][15]. - **Elevance Health, Inc. (NYSE:ELV)**: - Number of Hedge Fund Holders: 67 - Expected to reaffirm full-year 2025 earnings guidance of approximately $24.10 per diluted share, with adjusted earnings projected at around $30.00 per diluted share [17][18].

Core Viewpoint - The digital-asset treasury companies (DATs) are facing significant challenges as their stock prices decline and market confidence wanes, raising concerns about the sustainability of their business model [1][2][6]. Group 1: Market Performance - Shares of digital-asset treasury companies are experiencing a notable decline, with an average share drop of 15% last week among the 15 DATs tracked by Architect Partners [2] - ALT5 Sigma Corp. has seen its stock price decrease by approximately 50% in just over a week, while Kindly MD Inc. has dropped around 80% from its May high [3] - The overall market sentiment is shifting, with major players like Strategy and Metaplanet Inc. also witnessing significant stock price declines despite previous growth [11] Group 2: Industry Dynamics - There is an oversaturation of companies in the market, with over 100 firms entering the space this year, many lacking differentiation and offering little beyond the tokens they hold [4][6] - The model of publicly traded companies providing crypto exposure is becoming crowded, leading to a decline in confidence and premiums [6] - New data indicates a sharp decline in Bitcoin purchases by DATs, with only 14,800 Bitcoin bought in August compared to 66,000 in June, and a significant drop in average purchase sizes [7] Group 3: Financing and Risk - DATs are exploring innovative financing options, such as Bitcoin-backed loans and structured payouts, but these can introduce additional risks [8][13] - Nasdaq has begun requiring some token-holding companies to seek shareholder approval for new share issuances, impacting their capital-raising strategies [10] - The demand for flexible financing solutions is increasing, with firms like Two Prime seeing a rise in interest from DATs [13][14] Group 4: Investor Sentiment - Some investors are questioning the rationale behind investing in DATs instead of directly holding cryptocurrencies or through ETFs, indicating a lack of confidence in the current model [15]

Core Insights - Three stocks with strong value characteristics and a buy rank are highlighted for investors: Sally Beauty Holdings, ScanSource, and Healthcare Services Group [1][2][3] Company Summaries - **Sally Beauty Holdings, Inc. (SBH)**: - Niche retailer and distributor of professional beauty products - Zacks Rank 1 - Current year earnings estimate increased by 5.1% over the last 60 days - Price-to-earnings ratio (P/E) of 7.90, compared to 24.13 for the S&P 500 - Value Score of A [1] - **ScanSource, Inc. (SCSC)**: - Distributor of technology products and solutions - Zacks Rank 1 - Current year earnings estimate increased by 7.9% over the last 60 days - Price-to-earnings ratio (P/E) of 11.31, compared to 24.13 for the S&P 500 - Value Score of A [2] - **Healthcare Services Group, Inc. (HCSG)**: - Manages housekeeping, laundry, dining, and nutritional services in the healthcare industry - Zacks Rank 1 - Current year earnings estimate increased by 4.8% over the last 60 days - Price-to-earnings ratio (P/E) of 17.99, compared to 21.40 for the industry - Value Score of A [3]

Group 1: Jackson Financial - Jackson Financial is a U.S. retirement services provider with a Zacks Rank 1 (Strong Buy) [1] - The Zacks Consensus Estimate for Jackson Financial's current year earnings has increased by 5.9% over the last 60 days [1] - The company has a price-to-earnings ratio (P/E) of 4.83, significantly lower than the industry average of 10.60, and possesses a Value Score of A [2] Group 2: Smithfield Foods, Inc. - Smithfield Foods is a pork producer and food-processing company with a Zacks Rank 1 [2] - The Zacks Consensus Estimate for Smithfield Foods' current year earnings has increased by 3% over the last 60 days [2] - The company has a price-to-earnings ratio (P/E) of 10.53, slightly below the industry average of 11.60, and also possesses a Value Score of A [2] Group 3: Healthcare Services Group - Healthcare Services Group provides housekeeping, laundry, linen, facility maintenance, and food services to the healthcare industry, holding a Zacks Rank 1 [3] - The Zacks Consensus Estimate for Healthcare Services Group's current year earnings has increased by 9.2% over the last 60 days [3] - The company has a price-to-earnings ratio (P/E) of 17.74, lower than the industry average of 21.30, and possesses a Value Score of A [4]

Core Points - Healthcare Services Group, Inc. (HSGI) reported a data breach involving unauthorized access to its computer systems, which occurred between September 27, 2024, and October 3, 2024 [2] - The breach potentially exposed sensitive personal information of hundreds of thousands of consumers, including names, Social Security numbers, driver's license numbers, state identification numbers, and financial account information [2] - Barrack, Rodos & Bacine is investigating the breach and may pursue legal action on behalf of affected individuals [1][3] Company Summary - HSGI announced the breach on August 27, 2025, revealing that it had learned of the unauthorized access over ten months prior [2] - The investigation into the breach is ongoing, and the company is assessing the extent of the data compromised [2] - The firm Barrack, Rodos & Bacine specializes in class actions related to consumer rights and corporate misconduct, indicating a potential for legal repercussions for HSGI [5]

Group 1 - Healthcare Services Group, Inc. (HSG) announced a cybersecurity incident affecting the personal information of hundreds of thousands of individuals [1] - The data breach potentially compromised various types of personally identifiable information (PII), including names, Social Security numbers, driver's license numbers, state identification numbers, and financial account details [1] Group 2 - Lynch Carpenter, LLP is investigating claims against HSG related to the data breach, indicating potential legal repercussions for the company [2] - Individuals who received a data breach notification from HSG may be entitled to compensation, suggesting a significant impact on affected parties [2]

Group 1 - Healthcare Services (HCSG) is a stock that has shown strong year-to-date performance, returning approximately 31.1% compared to an average of 0% for Business Services stocks [4] - The Zacks Consensus Estimate for HCSG's full-year earnings has increased by 4.8% over the past 90 days, indicating improved analyst sentiment and earnings outlook [4] - HCSG currently holds a Zacks Rank of 1 (Strong Buy), suggesting it has favorable characteristics to outperform the market in the near term [3] Group 2 - The Business Services sector includes 254 individual stocks and has a Zacks Sector Rank of 6, which reflects the average Zacks Rank of stocks within the sector [2] - The Business - Services industry, which includes HCSG, consists of 26 stocks and is currently ranked 94 in the Zacks Industry Rank, with an average year-to-date gain of 8.4% [6] - Montrose Environmental (MEG), another stock in the Business Services sector, has outperformed with a year-to-date return of 47.8% and a Zacks Rank of 1 (Strong Buy) [5]

Group 1: Ardmore Shipping (ASC) - Ardmore Shipping is engaged in the ownership and operation of product and chemical tankers, carrying a Zacks Rank 1 (Strong Buy) [1] - The Zacks Consensus Estimate for Ardmore Shipping's current year earnings has increased by 2.6% over the last 60 days [1] - The company has a price-to-earnings ratio (P/E) of 9.15, significantly lower than the industry average of 19.5, and possesses a Value Score of A [2] Group 2: Dillard's (DDS) - Dillard's is a large departmental store chain featuring fashion apparel and home furnishings, also carrying a Zacks Rank 1 [2] - The Zacks Consensus Estimate for Dillard's current year earnings has increased by 2.6% over the last 60 days [2] - Dillard's has a price-to-earnings ratio (P/E) of 16.25, which is lower than the industry average of 19.80, and possesses a Value Score of A [3] Group 3: Healthcare Services Group (HCSG) - Healthcare Services Group provides housekeeping, laundry, linen, facility maintenance, and food services to the healthcare industry, including nursing homes and hospitals, and carries a Zacks Rank 1 [4] - The Zacks Consensus Estimate for Healthcare Services Group's current year earnings has increased by 4.8% over the last 60 days [4] - The company has a price-to-earnings ratio (P/E) of 17.31, compared to the industry average of 21.10, and possesses a Value Score of A [5]

Group 1 - Healthcare Services (HCSG) is currently outperforming its peers in the Business Services sector, with a year-to-date gain of approximately 19.2% compared to an average loss of 0.3% for Business Services stocks [4] - The Zacks Consensus Estimate for HCSG's full-year earnings has increased by 10% over the past quarter, indicating improved analyst sentiment and a more positive earnings outlook [4] - HCSG holds a Zacks Rank of 1 (Strong Buy), suggesting a strong potential for beating the market in the near term [3] Group 2 - The Business Services group includes 256 companies and is currently ranked 8 in the Zacks Sector Rank, which measures the strength of individual sector groups [2] - Huron Consulting (HURN), another stock in the Business Services sector, has a year-to-date return of 1.8% and a Zacks Rank of 2 (Buy) [5] - The Business - Services industry, which includes HCSG, has gained an average of 15.4% this year, indicating that HCSG is performing well within its industry [6]

PART I — FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Unaudited H1 2025 financial statements show a **$15.1 million** net loss, primarily due to a significant bad debt provision [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $82,818 | $56,776 | | Accounts receivable, net | $292,210 | $330,907 | | Total current assets | $532,294 | $556,652 | | Goodwill | $80,042 | $75,529 | | Total assets | $802,200 | $802,772 | | **Liabilities & Equity** | | | | Total current liabilities | $213,932 | $192,547 | | Total liabilities | $325,162 | $302,845 | | Total stockholders' equity | $477,038 | $499,927 | - Total assets remained relatively stable, while total stockholders' equity decreased by approximately **$22.9 million** from year-end 2024, primarily due to net loss and treasury stock purchases[13](index=13&type=chunk) [Consolidated Statements of Comprehensive (Loss)/Income](index=7&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20(Loss)%2FIncome) Q2 2025 vs Q2 2024 Performance (in thousands, except per share) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Revenues | $458,491 | $426,288 | | Costs of services provided | $455,533 | $384,742 | | (Loss) income before taxes | $(41,888) | $(1,986) | | Net (loss) income | $(32,366) | $(1,788) | | Diluted (loss) income per share | $(0.44) | $(0.02) | H1 2025 vs H1 2024 Performance (in thousands, except per share) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenues | $906,153 | $849,721 | | Costs of services provided | $835,224 | $743,653 | | (Loss) income before taxes | $(17,994) | $19,328 | | Net (loss) income | $(15,138) | $13,521 | | Diluted (loss) income per share | $(0.21) | $0.18 | - The company experienced a significant shift from net income in H1 2024 to a net loss in H1 2025, primarily due to a substantial increase in the 'Costs of services provided', which includes a large bad debt provision[15](index=15&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Six Months Ended June 30, Cash Flow Summary (in thousands) | Cash Flow Category | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $56,288 | $(9,714) | | Net cash used in investing activities | $(16,820) | $(16,039) | | Net cash (used in) provided by financing activities | $(16,455) | $970 | - Cash flow from operations improved significantly to **$56.3 million** in H1 2025 from a use of **$9.7 million** in H1 2024, largely driven by a high non-cash bad debt provision of **$73.4 million** and the receipt of **$20.0 million** in deferred Employee Retention Credits (ERC)[18](index=18&type=chunk) - Financing activities used **$16.5 million** in cash, primarily for purchases of treasury stock amounting to **$14.7 million**[18](index=18&type=chunk) [Notes to Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) - The company operates in two reportable segments: Housekeeping (laundry, linen, etc.) and Dietary department services, primarily serving the healthcare industry[27](index=27&type=chunk) - On July 9, 2025, Genesis Healthcare, Inc. filed for Chapter 11 bankruptcy, resulting in a **$61.2 million** bad debt expense recognized during the three and six months ended June 30, 2025[72](index=72&type=chunk) - During the six months ended June 30, 2025, the company received **$20.0 million** in Employee Retention Credit (ERC) refunds from the IRS, recorded as a deferred liability and not yet recognized as income[161](index=161&type=chunk) Segment Revenue and Profit (Loss) for Q2 2025 (in thousands) | Segment | Revenues | Segment Profit (Loss) | | :--- | :--- | :--- | | Housekeeping | $205,743 | $1,662 | | Dietary | $252,748 | $(25,471) | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=41&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 2025 revenue growth and liquidity, noting a **$61.2 million** bad debt expense impacted profitability [Results of Operations](index=41&type=section&id=Results%20of%20Operations) - Consolidated revenues for Q2 2025 increased by **7.6%** year-over-year, driven by a **7.7%** increase in Housekeeping and a **7.4%** increase in Dietary revenues[172](index=172&type=chunk)[177](index=177&type=chunk) - Consolidated costs of services provided for Q2 2025 increased by **18.4%** YoY, primarily due to recognizing **$61.2 million** in bad debt expense related to a large customer bankruptcy, with a **7.4%** increase excluding this impact[178](index=178&type=chunk) Segment Expenses as a % of Segment Revenue - Q2 2025 vs Q2 2024 | Segment | Key Expense | 2025 | 2024 | | :--- | :--- | :--- | :--- | | Housekeeping | Bad debt expense | 12.1% | 5.5% | | | Total segment expenses | 99.2% | 92.3% | | Dietary | Bad debt expense | 18.7% | 9.1% | | | Total segment expenses | 110.1% | 99.9% | [Liquidity and Capital Resources](index=49&type=section&id=Liquidity%20and%20Capital%20Resources) - As of June 30, 2025, the company had cash, cash equivalents, and marketable securities of **$134.5 million** and working capital of **$318.4 million**[210](index=210&type=chunk) - Net cash from operating activities was **$56.3 million** for the first six months of 2025, a significant improvement from a **$9.7 million** use of cash in the same period of 2024, largely due to non-cash bad debt charges and ERC refunds[211](index=211&type=chunk)[212](index=212&type=chunk) - The company repurchased **1.2 million** shares of its common stock for **$14.6 million** in the first six months of 2025 under its Repurchase Plan[215](index=215&type=chunk) - The company has a **$300 million** bank line of credit, with no borrowings as of June 30, 2025, and was in compliance with all financial covenants[217](index=217&type=chunk)[218](index=218&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=51&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company holds **$164.1 million** in cash and marketable securities, subject to interest rate risk from fixed and floating-rate investments - The company's primary market risk exposure is interest rate risk associated with its investments in fixed-rate and floating-rate securities[229](index=229&type=chunk) - As of June 30, 2025, the company had **$164.1 million** in cash and cash equivalents, restricted cash equivalents, and marketable securities[228](index=228&type=chunk) [Item 4. Controls and Procedures](index=51&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and internal financial reporting controls were effective as of June 30, 2025, with no material changes - Management concluded that the company's internal control over financial reporting was effective as of June 30, 2025[230](index=230&type=chunk) - No changes occurred during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[231](index=231&type=chunk) PART II — OTHER INFORMATION [Item 1. Legal Proceedings](index=54&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings in the ordinary course of business, not expecting a material adverse financial effect - The company is subject to various claims and legal actions in the ordinary course of business but does not expect them to have a material adverse effect on its financial condition[233](index=233&type=chunk) - For certain pending litigation, the company is currently unable to reasonably estimate possible losses or determine if an unfavorable outcome is probable or remote[234](index=234&type=chunk) [Item 1A. Risk Factors](index=54&type=section&id=Item%201A.%20Risk%20Factors) No material changes occurred to the risk factors previously disclosed in the company's 2024 Form 10-K - As of June 30, 2025, no material changes have been made to the Risk Factors disclosed in the company's 2024 Form 10-K[236](index=236&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=54&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased **522,696** shares for **$7.5 million** in Q2 2025, with **4.9 million** shares remaining for repurchase Share Repurchases for Q2 2025 | Period | Shares Repurchased | Average Price Paid | Aggregate Purchase Price (in thousands) | | :--- | :--- | :--- | :--- | | April 2025 | — | $— | $— | | May 2025 | — | $— | $— | | June 2025 | 522,696 | $14.38 | $7,515 | | **Q2 Total** | **522,696** | **$14.38** | **$7,515** | - As of June 30, 2025, the company has **4.9 million** shares remaining for repurchase under its authorized Repurchase Plan[237](index=237&type=chunk) [Item 5. Other Information](index=54&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted, terminated, or modified Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q2 2025 - No directors or officers adopted, terminated, or modified a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2025[241](index=241&type=chunk) [Item 6. Exhibits](index=55&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and iXBRL financial data - The report includes certifications from the CEO and CFO pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[242](index=242&type=chunk)