logo
Are You Looking for a Top Momentum Pick? Why Cadence (CADE) is a Great Choice

Are You Looking for a Top Momentum Pick? Why Cadence (CADE) is a Great Choice

Yahoo10-07-2025
Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.
While many investors like to look for momentum in stocks, this can be very tough to define. There is a lot of debate surrounding which metrics are the best to focus on and which are poor quality indicators of future performance. The Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.
Below, we take a look at Cadence (CADE), which currently has a Momentum Style Score of A. We also discuss some of the main drivers of the Momentum Style Score, like price change and earnings estimate revisions.
It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Cadence currently has a Zacks Rank of #1 (Strong Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.
You can see the current list of Zacks #1 Rank Stocks here >>>
In order to see if CADE is a promising momentum pick, let's examine some Momentum Style elements to see if this bank holds up.
A good momentum benchmark for a stock is to look at its short-term price activity, as this can reflect both current interest and if buyers or sellers currently have the upper hand. It's also helpful to compare a security to its industry; this can show investors the best companies in a particular area.
For CADE, shares are up 7.87% over the past week while the Zacks Banks - Southeast industry is up 4.73% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 13.15% compares favorably with the industry's 5.65% performance as well.
While any stock can see a spike in price, it takes a real winner to consistently outperform the market. Shares of Cadence have increased 26.14% over the past quarter, and have gained 23.01% in the last year. In comparison, the S&P 500 has only moved 15.13% and 13.62%, respectively.
Investors should also take note of CADE's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. Right now, CADE is averaging 1,525,588 shares for the last 20 days.
The Zacks Momentum Style Score also takes into account trends in estimate revisions, in addition to price changes. Please note that estimate revision trends remain at the core of Zacks Rank as well. A nice path here can help show promise, and we have recently been seeing that with CADE.
Over the past two months, 3 earnings estimates moved higher compared to none lower for the full year. These revisions helped boost CADE's consensus estimate, increasing from $2.85 to $2.92 in the past 60 days. Looking at the next fiscal year, 2 estimates have moved upwards while there have been 1 downward revision in the same time period.
Given these factors, it shouldn't be surprising that CADE is a #1 (Strong Buy) stock and boasts a Momentum Score of A. If you're looking for a fresh pick that's set to soar in the near-term, make sure to keep Cadence on your short list.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Cadence Bank (CADE) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Largest U.S. homebuilder: Housing market shift ‘still pointing towards' bigger incentives
Largest U.S. homebuilder: Housing market shift ‘still pointing towards' bigger incentives

Fast Company

timean hour ago

  • Fast Company

Largest U.S. homebuilder: Housing market shift ‘still pointing towards' bigger incentives

Want more housing market stories from Lance Lambert's ResiClub in your inbox? Subscribe to the ResiClub newsletter. On Tuesday, D.R. Horton—America's most valuable and largest homebuilder, with a $46 billion market capitalization and ranked No. 123 on the Fortune 500—reported its third-quarter earnings for the three months ending June 30. While D.R. Horton's earnings didn't wow investors, the fact that there wasn't an accelerated softening beyond what homebuilders— including D.R. Horton —had already reported earlier this year was enough for some Wall Street investors to buy back into homebuilder stocks. For today's piece, we're going to take a closer look at D.R. Horton's earnings and the commentary its executives provided during Tuesday's earnings call. Incentive spending is helping D.R. Horton's home sales hold steady D.R. Horton's net new orders, by its fiscal Q3 (the three months ending June 30th): Q3 2018 —> 14,650 Q3 2019 —> 15,588 Q3 2020 —> 21,519 Q3 2021 —> 17,952 Q3 2022 —> 16,693 Q3 2023 —> 22,879 Q3 2024 —> 23,001 Q3 2025 —> 23,071 D.R. Horton continues to see weakness in Florida While D.R. Horton's national net orders were pretty much flat year-over-year, there was a -10.1% year-over-year drop in its Southeast division. That division includes Florida—which D.R. Horton once again acknowledged remains on the softer/weaker side. 'There's been a lot of a change [weakening] in the dynamic in the Florida markets. And perhaps most so there. Other markets continue to be consistent performers where there's been limited inventory and limited development of lots. And housing production continues to see strong demand in those markets,' D.R. Horton chief operating officer Michael Murray said during their earnings call on July 22, 2025. North (13% of D.R. Horton's Q3 2025 net new orders): Delaware, Illinois, Indiana, Iowa, Kansas, Kentucky, Maryland, Minnesota, Missouri, Nebraska, New Jersey, Ohio, Pennsylvania, Virginia, West Virginia, and Wisconsin East (21%): Georgia, North Carolina, South Carolina, and Tennessee Northwest (6%): Colorado, Oregon, Utah, and Washington South Central (27%): Arkansas, Oklahoma, and Texas Southwest (10%): Arizona, California, Hawaii, Nevada, and New Mexico Southeast (24%): Alabama, Florida, Louisiana, and Mississippi D.R. Horton's average sales price moves sideways D.R. Horton's average sales price in Q3 2025 ($369,600) was -7.3% below the third-quarter peak in Q3 2022 ($398,800). It's possible that some of the drop in average sales price is due to shifts in product and geographic mix. Instead of outright price cuts, D.R. Horton has preferred to offer bigger incentives this cycle, such as mortgage rate buydowns. Regardless, D.R. Horton's average sales price confirms that upward pricing momentum has stalled in many markets. D.R. Horton's incentive spend has caused margin compression D.R. Horton reported a 21.8% gross margin on homes for Q3 2025. That's down from 24.0% in Q3 2024; however, it's unchanged from its Q2 2025 gross margin (21.8%). The fact that the margin didn't further compress quarter-over-quarter is why some investors bought the stock back. However, D.R. Horton acknowledged that, looking ahead, the ongoing housing market softening still points towards a bit higher incentives. 'Our commentary really over the last year has been that incentives have been increasing. That's been the main driver for the gross margin decline over the last year. Our operators are striving every day to strike the best balance between hitting pace and maintaining margin in each community to maximize returns. And so they're using all the levers they have with incentives to try to balance that. And so we have seen the pace of incentive cost increases and the pace of margin decline moderate a bit over the last couple of quarters and then this quarter it held flat sequentially [quarter-over-quarter],' Jessica Hansen, head of investor relations at D.R. Horton, said during their earnings call on July 22, 2025. Hansen added that: 'But the trend is still pointing towards a bit higher incentives, and we don't see significant offsets to that, though we will continue to work on costs on the construction side.' On Tuesday, D.R. Horton told investors expect Q4 2025 gross margins to come in between 21.0% and 21.5%. Labor hasn't been an issue for D.R. Horton yet despite the increased ICE crackdown 'From labor availability, it's plentiful. We have the labor that we need. Our trades are looking for work. And that's why you've seen sequential and year-over-year reduction in our cycle time. Because we have the support we need to get our homes built. And, you know, given those efficiencies, reductions in stick and brick [costs] over time. Some of that is from design. And efficiency of the product that we're putting in the field. And some of that is just from the efficiency of our operations,' D.R. Horton CEO Paul Romanowski said during their earnings call on July 22, 2025. Tariffs haven't coincided with higher stick-and-brick costs—but lumber tariffs are something to watch On Tuesday, D.R. Horton told analysts that stick-and-brick costs are down 2% year-over-year and down 1% quarter-over-quarter. Note: My understanding is that 'stick-and-brick costs' include direct construction costs of building a home on-site using traditional wood materials like lumber ('sticks') and masonry materials like concrete ('bricks'). These costs include both materials (e.g., lumber, drywall) and labor (plumbers, roofers, etc.). Although the White House hasn't included Canadian softwood lumber on their broader tariff list, the U.S. government is preparing to more than double the duties on Canadian lumber imports. As a part of its annual review, the U.S. Department of Commerce plans to raise the tariff on Canadian lumber from 14.45% to 34.45%. The U.S. Department of Commerce argues that Canadian lumber is being unfairly subsidized and sold below market value in the U.S. 'It [higher duties on Canadian lumber] will have some potential impact, but we've not quantified that. I know it is a significant step up in the tariff rates, I think, going to effect next month. But, you know, we're buying some percentage of that wood and there's some substitutionary product that would be available as well. Based on where that pricing ultimately settles,' D.R. Horton chief operating officer Michael Murray said during their earnings call on July 22, 2025. Homebuilder stocks got a little bounce following D.R. Horton's earnings Following the earnings reports from D.R. Horton and PulteGroup on Tuesday, Wall Street gave homebuilder shares a slight bounce. While the move doesn't return shares to the highs reached around September 2024, it could signal that some on Wall Street believe homebuilder margin compression is losing momentum. The super-early-rate deadline for Fast Company's Most Innovative Companies Awards is tonight, July 25, at 11:59 p.m. PT. Apply today.

T. Rowe Price (TROW) Expected to Beat Earnings Estimates: What to Know Ahead of Q2 Release
T. Rowe Price (TROW) Expected to Beat Earnings Estimates: What to Know Ahead of Q2 Release

Yahoo

time3 hours ago

  • Yahoo

T. Rowe Price (TROW) Expected to Beat Earnings Estimates: What to Know Ahead of Q2 Release

T. Rowe Price (TROW) is expected to deliver a year-over-year decline in earnings on lower revenues when it reports results for the quarter ended June 2025. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price. The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on August 1. On the other hand, if they miss, the stock may move lower. While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise. Zacks Consensus Estimate This financial services firm is expected to post quarterly earnings of $2.10 per share in its upcoming report, which represents a year-over-year change of -7.1%. Revenues are expected to be $1.71 billion, down 1.4% from the year-ago quarter. Estimate Revisions Trend The consensus EPS estimate for the quarter has been revised 9.62% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts. Price, Consensus and EPS Surprise Earnings Whisper Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction). The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). How Have the Numbers Shaped Up for T. Rowe? For T. Rowe, the Most Accurate Estimate is higher than the Zacks Consensus Estimate, suggesting that analysts have recently become bullish on the company's earnings prospects. This has resulted in an Earnings ESP of +0.99%. On the other hand, the stock currently carries a Zacks Rank of #1. So, this combination indicates that T. Rowe will most likely beat the consensus EPS estimate. Does Earnings Surprise History Hold Any Clue? Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that T. Rowe would post earnings of $2.09 per share when it actually produced earnings of $2.23, delivering a surprise of +6.70%. Over the last four quarters, the company has beaten consensus EPS estimates three times. Bottom Line An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. T. Rowe appears a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. An Industry Player's Expected Results Among the stocks in the Zacks Financial - Investment Management industry, Blue Owl Capital Inc. (OWL), is soon expected to post earnings of $0.21 per share for the quarter ended June 2025. This estimate indicates a year-over-year change of +10.5%. This quarter's revenue is expected to be $636.89 million, up 22.5% from the year-ago quarter. The consensus EPS estimate for Blue Owl Capital has been revised 0.3% higher over the last 30 days to the current level. However, a lower Most Accurate Estimate has resulted in an Earnings ESP of -0.82%. This Earnings ESP, combined with its Zacks Rank #3 (Hold), makes it difficult to conclusively predict that Blue Owl Capital will beat the consensus EPS estimate. The company could not beat consensus EPS estimates in any of the last four quarters. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report T. Rowe Price Group, Inc. (TROW) : Free Stock Analysis Report Blue Owl Capital Inc. (OWL) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research

TT Gears Up to Report Q2 Earnings: Here's What You Should Know
TT Gears Up to Report Q2 Earnings: Here's What You Should Know

Yahoo

time3 hours ago

  • Yahoo

TT Gears Up to Report Q2 Earnings: Here's What You Should Know

Trane Technologies plc TT is set to report second-quarter 2025 earnings on July 30, before the bell. The Zacks Consensus Estimate for earnings is pegged at $12.92 per share, indicating 15.2% year-over-year growth. The Zacks Consensus Estimate for revenues is pegged at $21.57 billion, indicating an 8.7% increase from the second-quarter 2024 actuals. TT's earnings surprise history has been encouraging. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average beat being 6.4%. Trane Technologies plc Price and EPS Surprise Trane Technologies plc price-eps-surprise | Trane Technologies plc Quote Q2 Expectations for TT Robust demand for innovative products and services in the Americas Commercial HVAC segment are expected to have positively impacted the top line. We expect Americas revenues to jump 10.1% from the year-ago figure to $4.7 billion. Our prediction for revenues from the EMEA is pinned at $677.5 million, indicating 5% year-over-year growth. Bottom-line growth is likely to have been supported by improved operational efficiency. What Our Model Says About TT Our proven Zacks model predicts an earnings beat for Trane Technologies this reporting cycle. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here. Trane Technologies has an Earnings ESP of +0.54% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter. Stocks to Consider Here are a few stocks from the broader Business Services sector, which, according to our model, have the right combination of elements to beat on earnings this time. Api Group APG: The Zacks Consensus Estimate for second-quarter 2025 revenues is pegged at $1.90 billion, indicating a 10% rise year over year. For earnings, the consensus mark is pegged at 37 cents per share, suggesting a 12% increase from the year-ago quarter's reported figure. The company beat on earnings in three of the past four quarters and met once, delivering an average surprise of 4.1%. APG currently has an Earnings ESP of +2.05% and a Zacks Rank of 1. You can see the complete list of today's Zacks #1 Rank stocks here. Fidelity National Information Services FIS: The Zacks Consensus Estimate for second-quarter 2025 revenues is pegged at $2.6 billion, implying a 3.5% rise year over year. For earnings, the consensus mark is pegged at $1.36 per share. The company beat on earnings in each of the trailing four quarters, delivering an average surprise of 5.9%. FIS currently has an Earnings ESP of +0.67% and a Zacks Rank of 3. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Fidelity National Information Services, Inc. (FIS) : Free Stock Analysis Report Trane Technologies plc (TT) : Free Stock Analysis Report APi Group Corporation (APG) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store