Core Insights - The Zacks Style Scores provide a framework for evaluating stocks based on value, growth, and momentum, enhancing investment decision-making [2][3][6] Group 1: Zacks Style Scores Overview - The Zacks Style Scores rate stocks with an alphabetic system from A to F, where A indicates the highest potential for outperforming the market [3] - The Style Scores are categorized into four types: Value Score, Growth Score, Momentum Score, and VGM Score, each focusing on different investment strategies [3][4][5][6] Group 2: Value Score - The Value Score identifies stocks trading below their true value by analyzing financial ratios such as P/E, PEG, and Price/Sales [3] Group 3: Growth Score - The Growth Score emphasizes a company's financial health and future growth potential, using historical and projected earnings, sales, and cash flow [4] Group 4: Momentum Score - The Momentum Score helps investors capitalize on price trends, utilizing metrics like short-term price changes and earnings estimate revisions [5] Group 5: VGM Score - The VGM Score combines the three Style Scores to highlight stocks with attractive value, strong growth forecasts, and positive momentum [6] Group 6: Zacks Rank Integration - The Zacks Rank, a proprietary stock-rating model, uses earnings estimate revisions to assist in portfolio building, with 1 (Strong Buy) stocks historically yielding an average annual return of +23.9% since 1988 [7] - Stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B are recommended for maximizing return potential [9] Group 7: Stock Example - CF Industries - CF Industries Holdings, Inc. is a major global manufacturer of nitrogenous fertilizers, currently holding a Zacks Rank of 3 (Hold) and a VGM Score of A [11] - The company has a Momentum Style Score of B, with shares increasing by 3.6% over the past four weeks, and an upward revision of earnings estimates for fiscal 2025 [12]
CF Industries (CF) is a Top-Ranked Momentum Stock: Should You Buy?