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Low Volatility & Momentum Stocks to Own Right Now

Mar 13, 2019

Better Data for Better Investment DecisionsBetter Data for Better Investment Decisions
Better Data for Better Investment DecisionsBetter Data for Better Investment Decisions

 

  • In our post from earlier today, “ETFs AM Wrap-Up Highlighting Rotation to Defensive ETFs and Why Investors Are Buying IVV Over SPY”, we observed that minimum volatility-focused ETFs are receiving elevated levels of fund flows, both on a 30-day basis and 90-day basis. As can be seen in the post, the iShares Edge MSCI Minimum Volatility USA ETF (USMV) received +USD$1.26bn of flows in the last 30 days (5th among ETFs in our coverage universe) and +USD$4.10bn of flows in the last 90 days (3rd among ETFs in our coverage universe).
     
  • In light of the heightened demand for low volatility ETFs, we highlight the 10 best low volatility & momentum stocks in our US Large-Cap stock model, sorted by most attractive exposure to the Quality Value factor. Our AI stock models identify these stocks as poised to outperform their respective benchmarks over the next 1-2 months!

Quantamize US Large-Cap Low Volatility & Momentum Top Buys

Company Name Ticker Sector Industry US Large-Cap Rank Low Vol. & Momentum Factor Ranking
REALTY INCOME CORP O Real Estate REITs Top Buy Top Buy
CENTERPOINT ENERGY INC CNP Utilities Multi-Utilities Top Buy Top Buy
STORE CAPITAL CORP STOR Real Estate REITs Top Buy Top Buy
AMERICAN ELECTRIC POWER CO AEP Utilities Electric Utilities Top Buy Top Buy
XCEL ENERGY INC XEL Utilities Electric Utilities Top Buy Top Buy
ATMOS ENERGY CORP ATO Utilities Gas Utilities Top Buy Top Buy
OLD REPUBLIC INTL CORP ORI Financials Insurance Top Buy Top Buy
AVALONBAY COMMUNITIES INC AVB Real Estate REITs Top Buy Top Buy
UNITEDHEALTH GROUP INC UNH Health Care Health Care Providers & Services Top Buy Top Buy
GENUINE PARTS CO GPC Consumer Discretionary Distributors Top Buy Top Buy

Source: Capital IQ
 

  • As can be seen in the table above, real estate and utilities stocks dominate our top 10 low volatility & momentum names with the 6 most attractive stocks falling into those sectors.  
     
  • Our low volatility & momentum US large-cap stock highlights are led by Realty Income Corp. (O), the S&P 500 REIT that prioritizes dependable monthly income for investors. It is rare to see such an attractive income stock like Realty Income Corp., which offers a dividend yield of 3.8%, also look so appealing on a low volatility & momentum basis. This truly is a conviction buy!
     
  • Realty Income Corp. is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas.
     
  • CenterPoint Energy, Inc. (CNP) closely follows Realty Income Corp. as the second-most attractive low volatility & momentum stock in our US Large-Cap stock model. Analysts expect the Texas-based multi-utility to grow its EPS by a robust 7.23% per annum over the next 3 years! The stock has also hiked its annual dividend payment to investors in every year for the last 13 years, most recently paying investors USD$1.11 for each share owned in FY2018.
     
  • CenterPoint Energy is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas.
     
  • Old Republic International Corp. (ORI), the insurance underwriter that operates in Canada and the US, is the only financials stock highlighted above. Old Republic International Corp. has an average price target of USD$24.00/share, more than 15% higher than its Tuesday closing price!
     
  • Old Republic International Corp. is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas.
     
  • UnitedHealth Group Inc. (UNH) is the sole health care stock highlighted as a top low volatility & momentum name in our US Large-Cap stock model. In FY2018, UnitedHealth Group Inc. delivered a 24.1% return on common equity to shareholders, far superior to the S&P 500 Health Care Index’s aggregate return on common equity of 14.9%!
     
  • United Health Group Inc. is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas. 
     
  • Genuine Parts Co. (GPC) rounds out our list of the 10 most attractive low volatility & momentum stocks in our US Large-Cap stock model, being the only consumer name highlighted in the list. In every fiscal year since 2009, Genuine Parts Co. has delivered an annual EPS beat relative to analyst consensus estimates, a massively good sign for investors!
     
  • Genuine Parts Co. is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.

 

 

Global Top Stock IdeasTOP LONG & TOP SHORT STOCK IDEAS FOR GLOBAL MARKETSMONTHLY TOP IDEAS FROM OUR MULTI-FACTOR QUANTITATIVE MODELS
Global Top Stock IdeasTOP LONG & TOP SHORT STOCK IDEAS FOR GLOBAL MARKETSMONTHLY TOP IDEAS FROM OUR MULTI-FACTOR QUANTITATIVE MODELS