Why Pegasystems (PEGA) is a Top Growth Stock for the Long-Term

Core Insights - Zacks Premium offers various tools for investors to enhance their stock market engagement and confidence [1] - The Zacks Style Scores provide a unique rating system for stocks based on value, growth, and momentum, aiding investors in selecting securities likely to outperform the market [2][3] Zacks Style Scores Overview - Stocks are rated from A to F based on their value, growth, and momentum characteristics, with A being the highest score indicating a better chance of outperforming [3] - The Style Scores are categorized into four types: Value Score, Growth Score, Momentum Score, and VGM Score [3][4][5][6] Value Score - The Value Style Score focuses on identifying undervalued stocks using financial ratios such as P/E, PEG, Price/Sales, and Price/Cash Flow [3] Growth Score - The Growth Style Score emphasizes a company's financial health and future potential, analyzing projected and historical earnings, sales, and cash flow [4] Momentum Score - The Momentum Style Score is designed for traders who capitalize on price trends, utilizing factors like short-term price changes and earnings estimate shifts [5] VGM Score - The VGM Score combines all three Style Scores, providing a comprehensive indicator for investors who value a mix of growth, value, and momentum [6] Zacks Rank Integration - The Zacks Rank is a proprietary model based on earnings estimate revisions, with 1 (Strong Buy) stocks achieving an average annual return of +23.93% since 1988, significantly outperforming the S&P 500 [7] - There are over 800 stocks rated 1 or 2, making it essential for investors to utilize Style Scores to refine their selections [8] Investment Strategy - To maximize returns, investors should target stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B, while also considering the earnings outlook [9][10] Company Spotlight: Pegasystems (PEGA) - Pegasystems is an enterprise software provider focused on AI-driven decision-making and workflow automation [11] - Currently rated 3 (Hold) with a VGM Score of B, PEGA has a Growth Style Score of A, forecasting a year-over-year earnings growth of 37.8% for the current fiscal year [11] - Recent upward revisions in earnings estimates by four analysts have increased the Zacks Consensus Estimate to $2.08 per share, with an average earnings surprise of +80.5% [12]