Key Takeaways NVIDIA's 56% revenue surge fueled record market highs, affirming investor confidence in AI growth.Stocks like Arista, TE Connectivity, Corning, Banco Bilbao, and AppLovin qualified on high ROE.Screening used cash flow over $1B, ROE above industry, strong EPS growth, and favorable valuations. Over the past couple of days, the broader equity markets hit the right chords by scaling all-time highs on the trot, led by the solid quarterly performance of AI behemoth NVIDIA and a healthy economy. With ...

Over the past couple of days, the broader equity markets have hit record highs on the trot, buoyed by a tamer inflation report that greatly increased the probability of an interest rate cut by the Federal Reserve as early as the policy meeting scheduled next month. While the July report revealed that the consumer price index rose 2.7% on an annualized basis compared with broad-based expectations of a 2.8% rise, the core CPI (which strips out volatile food and energy prices) increased 3.1% year on year — sli ...

Market Overview - The broader equity markets have shown a steady uptrend as investors remain optimistic despite tariff threats from President Trump on 14 countries, including Japan and South Korea [1] - Investors are hopeful for a mutually beneficial solution to avoid market turmoil as they look forward to a busy earnings season [1][2] Trade Relations - Positive discussions between U.S.-China diplomats regarding trade tariffs and potential peace talks between U.S. officials and Iran have contributed to market stability [2] - Investors are awaiting clarity on interest rate cuts with inflation data expected to be released soon [2] Investment Strategy - Investors are advised to focus on "cash cow" stocks that provide higher returns, emphasizing the importance of attractive efficiency ratios like return on equity (ROE) [3] - High ROE indicates effective reinvestment of cash at a high rate of return, distinguishing profitable companies from less efficient ones [4][5] Stock Screening Parameters - Stocks are screened based on criteria including cash flow greater than $1 billion and ROE exceeding industry averages [6] - Additional metrics include Price/Cash Flow lower than industry average and Return on Assets (ROA) greater than industry average [7] Featured Stocks - **Walt Disney**: Long-term earnings growth expectation of 11.8% with a trailing four-quarter earnings surprise of 16.4% on average, Zacks Rank 2 [8][9] - **TE Connectivity**: Long-term earnings growth expectation of 9.8% with a trailing four-quarter earnings surprise of 3.3% on average, Zacks Rank 2 [10][11] - **Fortinet**: Long-term earnings growth expectation of 13.4% with a trailing four-quarter earnings surprise of 23.8% on average, Zacks Rank 2 [12][13] - **Banco Bilbao**: Long-term earnings growth expectation of 5.5% with a trailing four-quarter earnings surprise of 6.3% on average, Zacks Rank 1 [13][14] - **Colgate-Palmolive**: Long-term earnings growth expectation of 5.2% with a trailing four-quarter earnings surprise of 4% on average, Zacks Rank 2 [14][15]