Why Quick-paced Mover Ultrapar Participacoes S.A. (UGP) Is a Nice Selection for Worth Traders
Momentum investing is basically an exception to the thought of “shopping for low and promoting excessive.” Traders following this model of investing are normally not focused on betting on low-cost shares and ready lengthy for them to get well. As a substitute, they imagine that “shopping for excessive and promoting larger” is the best way to make far more cash in lesser time.
Who would not like betting on fast-moving trending shares? However figuring out the fitting entry level is not simple. Usually, these shares lose momentum as soon as their valuation strikes forward of their future development potential. In such a scenario, traders discover themselves loaded up on costly shares with restricted to no upside or perhaps a draw back. So, going all-in on momentum may very well be dangerous at instances.
A safer method may very well be investing in cut price shares with current value momentum. Whereas the Zacks Momentum Fashion Rating (a part of the Zacks Fashion Scores system) helps establish nice momentum shares by paying shut consideration to tendencies in a inventory’s value or earnings, our ‘Quick-Paced Momentum at a Cut price’ display screen comes helpful in recognizing fast-moving shares which are nonetheless attractively priced.
There are a number of shares that presently move by way of the display screen and Ultrapar Participacoes S.A. (UGP) is one among them. Listed here are the important thing the reason why this inventory is a superb candidate.
Traders’ rising curiosity in a inventory is mirrored in its current value improve. A value change of 9.1% over the previous 4 weeks positions the inventory of this firm nicely on this regard.
Whereas any inventory can see a spike in value for a brief interval, it takes an actual momentum participant to ship constructive returns for an extended timeframe. UGP meets this criterion too, because the inventory gained 3.7% over the previous 12 weeks.
Furthermore, the momentum for UGP is quick paced, because the inventory presently has a beta of 1.2. This means that the inventory strikes 20% larger than the market in both route.
Given this value efficiency, it’s no shock that UGP has a Momentum Rating of B, which signifies that that is the fitting time to enter the inventory to reap the benefits of the momentum with the best likelihood of success.
Along with a positive Momentum Rating, an upward pattern in earnings estimate revisions has helped UGP earn a Zacks Rank #2 (Purchase). Our analysis reveals that the momentum-effect is kind of robust amongst Zacks Rank #1 and #2 shares. That is as a result of as overlaying analysts elevate their earnings estimates for a inventory, an increasing number of traders take an curiosity in it, serving to its value race to maintain up. You’ll be able to see the entire checklist of at the moment’s Zacks Rank #1 (Sturdy Purchase) shares right here >>>>
Most significantly, regardless of possessing fast-paced momentum options, UGP is buying and selling at an inexpensive valuation. When it comes to Value-to-Gross sales ratio, which is taken into account as among the best valuation metrics, the inventory seems fairly low-cost now. UGP is presently buying and selling at 0.12 instances its gross sales. In different phrases, traders have to pay solely 12 cents for every greenback of gross sales.
So, UGP seems to have loads of room to run, and that too at a quick tempo.
Along with UGP, there are a number of different shares that presently move by way of our ‘Quick-Paced Momentum at a Cut price’ display screen. It’s possible you’ll take into account investing in them and begin on the lookout for the latest shares that match these standards.
This isn’t the one display screen that might make it easier to discover your subsequent profitable inventory choose. Based mostly in your private investing model, you might select from over 45 Zacks Premium Screens which are strategically created to beat the market.
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Ultrapar Participacoes S.A. (UGP) : Free Stock Analysis Report