The stock market ended last week with losses. The Dow Jones Industrial Average declined 1%, while the S&P 500 and the Nasdaq Composite fell 1.6% and 2.4%, respectively. Since the beginning of the year, the major market indexes have been facing substantial selling pressure due to investors’ concerns over aggressive interest rate hikes by the Federal Reserve to tame the multi-decade high inflation, supply disruptions arising out of the continuing Ukraine-Russia war, rising energy and commodity prices, and the possibility of a recession.
The stronger-than-expected May jobs data is expected to reinforce a series of rate hikes by the Federal Reserve. Allianz Investment Management’s senior investment strategist Charlie Ripley said in a note, “Overall, the jobs report reinforces the strength of the overall economy, but also indicates the Fed still has their work cut out for them and may need to continue 50 basis point rate hikes through the autumn months.”
With more rate hikes on the horizon, investors should look to stocks with solid positive momentum. These stocks, which have shown strength and an upward trend, should be able to withstand near-term market fluctuations. That’s why today we're highlighting 4 exciting stocks from our Top 10 Momentum screen, which is just 1 of the 10 screens in our POWR Screens 10 service (more on that below). Grindrod Shipping Holdings Ltd. (GRIN), Adams Resources & Energy, Inc. (AE), Birchcliff Energy Ltd. (BIREF), and TransAlta Corporation (TAC), have experienced impressive momentum recently and possess solid fundamentals.
Grindrod Shipping Holdings Ltd. (GRIN)
GRIN is an international shipping company based in Singapore that owns, charters in, and operates a fleet of dry bulk carriers and tankers worldwide.
On May 17, 2022, GRIN announced that it had entered into a contract to sell the medium-range product tanker Matuku for $30 million. Anticipating its sale, the company exercised the purchase option for the tanker under the existing lease financing arrangement at the cost of $25.40 million following the expiration of the bareboat charter.
GRIN’s revenue increased 61.1% year-over-year to $110.28 million for the first quarter ended March 31, 2022. The company’s adjusted EBITDA increased 137% year-over-year to $50.15 million. Also, its adjusted net income increased 1,119.3% year-over-year to $29.82 million.
Analysts expect GRIN’s EPS for fiscal 2022 to increase 9.6% year-over-year to $6.46. Over the past year, the stock has gained 228.6% to close the last trading session at $27.31. GRIN is currently trading above its 50-day and 200-day moving averages of $25.43 and $19.16, respectively, indicating an uptrend.
GRIN’s strong fundamentals are reflected in its POWR Ratings. It has an overall rating of A, which equates to a Strong Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
It has an A grade for Sentiment and a B grade for Growth, Value, and Momentum. Within the A-rated Shipping industry, it is ranked #4 out of 46 stocks. Click here to see the other ratings of GRIN for Stability and Quality.
Adams Resources & Energy, Inc. (AE)
AE is engaged in crude oil marketing, transportation, terminalling, and storage in various crude oil and natural gas basins. The company operates through three segments: crude oil marketing, transportation, and storage; tank truck transportation of liquid chemicals, pressurized gases, asphalt, and dry bulk; pipeline transportation, terminalling; and crude oil storage.
For the fiscal first quarter ended March 31, 2022, AE’s total revenues increased 137.8% year-over-year to $774.25 million. The company’s adjusted cash flow increased 106.4% year-over-year to $4.03 million. Also, its net earnings increased 116.8% year-over-year to $6.09 million.
For the quarter ending September 30, 2022, AE’s EPS is expected to increase 122.2% year-over-year to $0.80. Its revenue for the quarter ending June 30, 2022, is expected to increase 57.1% year-over-year to $764.88 million. Over the past six months, the stock has gained 40% to close the last trading session at $37.12. AE is currently trading above its 50-day and 200-day moving averages of $36.91 and $32.07, respectively, indicating an uptrend.
AE’s POWR Ratings reflect solid prospects. The stock has an overall A rating, equating to a Strong Buy in our proprietary rating system.
It has an A grade for Value and Momentum and a B grade for Sentiment and Quality. It is ranked first out of 100 stocks in the B-rated Energy – Oil & Gas industry. To see the other ratings of AE for Growth and Stability, click here.
Birchcliff Energy Ltd. (BIREF)
Headquartered in Calgary, Canada, BIREF is an intermediate oil and natural gas company that acquires, explores, develops, and produces natural gas, light oil, condensate, and natural gas liquids in Western Canada.
BIREF’s quarterly average production increased 1% year-over-year to 76,024 boe/d for the first quarter ended March 31, 2022. The company’s net income to common shareholders increased 467% year-over-year to $125.79 million. Also, its EPS came in at $0.47, representing an increase of 488% year-over-year.
Analysts expect BIREF’s EPS for the quarter ending June 30, 2022, to increase 92.6% year-over-year to $298.45 million. Over the past year, the stock has gained 206.6% to close the last trading session at $9.26. BIREF is currently trading above its 50-day and 200-day moving averages of $7.73 and $5.82, respectively, indicating an uptrend.
BIREF’s strong fundamentals are reflected in its POWR Ratings. It has an overall rating of A, which equates to a Strong Buy in our proprietary rating system.
It has an A grade for Momentum and a B grade for Growth, Stability, and Quality. It is ranked #3 in the Energy – Oil & Gas industry. Click here to see the other ratings of BIREF for Value and Sentiment.
TransAlta Corporation (TAC)
Headquartered in Calgary, Canada, TAC owns, operates, and develops a diverse fleet of electrical power generation assets in Canada, the United States, and Australia. It operates through four segments: Hydro; Wind and Solar; Gas; and Energy Transition. The company owns hydro, wind and solar, natural gas-fired, and coal-fired facilities. It serves the municipalities, medium and large industries, businesses, and utility customers.
On April 5, 2022, TAC announced that it had entered into a long-term renewable energy purchase agreement with Meta Platforms, Inc. (FB) for the offtake of the whole 200MW Horizon Hill Wind Power Project. The long-term contract with FB enables TAC to add the 200MW Horizon Hill Wind Project to its US wind generation fleet. TAC’s President and CEO John Kousinioris said, “Horizon Hill brings us to 40 percent of our target of adding 2 GW of new renewables to our fleet by 2025 under our Clean Electricity Growth Plan.”
For the fiscal first quarter ended March 31, 2022, TAC’s revenues increased 14.4% year-over-year to $735 million. The company’s cash flow from operating activities increased 75.4% year-over-year to $451 million. Also, its net earnings attributable to common shareholders came in at $186 million, compared to the net loss of $30 million in the year-ago period. In addition, its EPS came in at $0.69, compared to a loss per share of $0.11 in the year-ago period.
For fiscal 2022, TAC’s EPS is expected to increase 138.3% year-over-year to $0.64. Over the past year, the stock has gained 21.6% to close the last trading session at $11.52. TAC is currently trading above its 50-day and 200-day moving averages of $10.84 and $10.59, respectively, indicating an uptrend.
TAC’s POWR Ratings reflect solid prospects. The stock has an overall A rating, equating to a Strong Buy in our proprietary rating system.
It has a B grade for Growth, Momentum, Sentiment, and Quality. Within the B-rated Utilities – Foreign industry, it is ranked first out of 54 stocks. To see the other ratings of TAC for Value and Stability, click here.
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GRIN shares were trading at $26.85 per share on Monday afternoon, down $0.46 (-1.68%). Year-to-date, GRIN has gained 53.28%, versus a -13.10% rise in the benchmark S&P 500 index during the same period.
About the Author: Dipanjan Banchur
Since he was in grade school, Dipanjan was interested in the stock market. This led to him obtaining a master’s degree in Finance and Accounting. Currently, as an investment analyst and financial journalist, Dipanjan has a strong interest in reading and analyzing emerging trends in financial markets.
4 Top Momentum Stocks to Buy in June StockNews.com
