4 Top-Performing Liquid Stocks for Robust Portfolio Returns

Core Insights - Building a portfolio with stocks that have robust liquidity levels is likely to yield healthy returns for investors [1] - High liquidity stocks are in demand due to their potential for maximum returns, but caution is advised as high liquidity may indicate inefficient asset utilization [1] - Companies like Abercrombie & Fitch Co., EverQuote, Inc, Sezzle Inc, and Peloton Interactive, Inc are suggested for portfolio consideration [1] Liquidity Measures - Current Ratio: Measures current assets against current liabilities; a ratio below 1 indicates more liabilities than assets, while a range of 1-3 is ideal [2] - Quick Ratio: Indicates ability to pay short-term obligations, with a desirable ratio of more than 1 [2] - Cash Ratio: The most conservative measure, focusing on cash and equivalents against current liabilities; a ratio greater than 1 is desirable but may indicate inefficiency [3] Screening Parameters - Asset Utilization: A measure of efficiency, with a higher ratio than the industry average indicating better performance [4] - Growth Style Score: Ensures that liquid and efficient stocks have solid growth potential [4] - Zacks Rank: Only stocks rated as Strong Buy can qualify, narrowing the selection to six stocks [4] Company Highlights - Abercrombie & Fitch Co. anticipates a 12-13% increase in fiscal 2024 net sales, raising its previous estimate of 10%; however, a shorter fiscal year may impact sales by $80 million [6] - EverQuote is positioned for long-term growth with a focus on core markets and a Zacks Consensus Estimate for 2024 earnings at 57 cents per share [7] - Sezzle's revenues increased by 60% year over year, with management raising its revenue growth outlook for 2024 to 35-40% [8] - Peloton Interactive's revenues were nearly flat at $643.6 million, with a Zacks Consensus Estimate for fiscal 2025 showing a loss of 65 cents per share [9]