Key Takeaways Meta Platforms and Vertiv were selected as the top momentum stocks using the Driehaus strategy.The Driehaus approach favors stocks with rising prices, strong earnings growth, and positive momentum.Both Meta and Vertiv hold Zacks Rank #2 ratings, a Momentum Score of A, and robust EPS surprise histories. Historically, October has been a volatile month for the stock market, making it challenging to pick the top momentum stocks. Therefore, savvy investors should employ the "buy high and sell highe ...

Core Insights - A potential Federal Reserve rate cut, strong retail sales, and progress in U.S.-China trade talks may positively impact the broader stock market, but not all stocks are guaranteed to perform well. Investors are advised to use the Driehaus strategy to identify the best momentum stocks [1] Group 1: Driehaus Strategy Overview - The Driehaus strategy emphasizes investing in stocks that are increasing in price rather than those in decline, focusing on strong earnings growth and positive momentum indicators [3][5] - Key criteria for the Driehaus strategy include a positive percentage 50-day moving average and strong earnings growth rates, with a focus on companies that consistently beat earnings estimates [4][5] Group 2: Selected Momentum Stocks - AppLovin Corporation (APP), Build-A-Bear Workshop, Inc. (BBW), and Tenet Healthcare Corporation (THC) have been identified as momentum picks based on the Driehaus strategy [2][8] - AppLovin has a Momentum Score of B and an average trailing four-quarter earnings surprise of 22.4% [10] - Build-A-Bear Workshop also has a Momentum Score of B, with an average trailing four-quarter earnings surprise of 21.3% [11] - Tenet Healthcare, with a Momentum Score of B, boasts an average trailing four-quarter earnings surprise of 31.2% [12]

Core Insights - Richard Driehaus has been recognized on Barron's All-Century Team for his "buy high and sell higher" investment strategy, which focuses on selecting top momentum stocks [1] - Currently, NVIDIA Corporation (NVDA), Meta Platforms, Inc. (META), and Amazon.com, Inc. (AMZN) are identified as momentum stocks under the Driehaus strategy [1][8] Driehaus Strategy Overview - Driehaus prefers investing in stocks that are increasing in price rather than those in decline, emphasizing the importance of momentum [2] - The American Association of Individual Investors (AAII) uses the percentage 50-day moving average as a key criterion for portfolio creation based on Driehaus' philosophy [2][3] Momentum Indicators - The strategy incorporates a calculation involving the month-end price and the 50-day moving average to assess momentum [3] - Positive relative strength is also a critical indicator, with a positive percentage 50-day moving average signifying an uptrend [3] Stock Selection Criteria - AAII emphasizes strong earnings growth rates and impressive earnings projections to identify potential outperformers [4] - Stocks with a Zacks Rank of 1 (Strong Buy), 2 (Buy), or 3 (Hold) and a Momentum Score of A or B are prioritized for better upside potential [5][6] Screening Parameters - Stocks must have a last 5-year average EPS growth rate above 2% and a trailing 12-month EPS growth greater than 0 to indicate superior earnings performance [7] - A positive percentage change in the 50-day moving average and relative strength over four weeks signals an uptrend [7] Highlighted Stocks - NVIDIA (NVDA) has a Zacks Rank of 3 and a Momentum Score of A, with an average trailing four-quarter earnings surprise of 3.6% [9][10] - Meta (META) also holds a Zacks Rank of 3 and a Momentum Score of A, with an average trailing four-quarter earnings surprise of 20.5% [11] - Amazon (AMZN) has a Zacks Rank of 3 and a Momentum Score of A, with an average trailing four-quarter earnings surprise of 23% [12]

Core Insights - The Driehaus strategy, known as "buy high and sell higher," is highlighted as an effective method for selecting top momentum stocks, with Intuit Inc. (INTU) and Ferrari N.V. (RACE) identified as current picks using this strategy [1][8]. Driehaus Strategy Overview - Richard Driehaus emphasized a preference for investing in stocks that are increasing in price rather than those in decline, which aligns with the philosophy of the American Association of Individual Investors (AAII) that uses the percentage 50-day moving average as a key criterion [2][4]. - The strategy incorporates momentum indicators such as positive relative strength and the percentage change in the 50-day moving average, indicating an uptrend when the stock price is above its 50-day moving average [3][7]. Screening Parameters - Stocks selected for the Driehaus strategy must have a Zacks Rank of 1 (Strong Buy) and a Momentum Score of A or B, with research indicating that these criteria enhance upside potential [5][9]. - Key parameters include: - Last 5-year average EPS growth rates above 2% [7] - Trailing 12-month EPS growth greater than 0 and above industry median [7] - Last four-quarter average EPS surprise greater than 5% [7] - Positive percentage change in the 50-day moving average and relative strength over 4 weeks [7]. Selected Stocks - Intuit Inc. (INTU) has a Momentum Score of B and an average earnings surprise of 12.2% over the last four quarters [8][10]. - Ferrari N.V. (RACE) holds a Momentum Score of A with an average earnings surprise of 10.8% across the last four quarters [8][11].