As the S&P 500 enters a bear market, finding companies that have strong fundamentals is even more important. In IBD's Screen of the Day, the list of rising profit estimates highlight these growth stocks.
The screen looks for companies for which analysts have increased their profit expectations. It has been a tough time for IBD's Computer Software and Design group, which ranks 174th out of IBD's 197 industries. Nevertheless, Synopsis — which makes semiconductor design software — has been outperforming and ranks first in the group.
Company shares shot higher Thursday after reporting first-quarter results. EPS of $2.50 beat analyst estimates of $2.37 while revenue of $1.28 billion also beat expectations. Furthermore, the company increased its guidance, forecasting EPS growth of 25% and revenue growth of 20% for 2022.
Strong results and rising profits make Synopsis an interesting growth stock to watch. Shares are forming a double-bottom base with a 342.69 entry point, according to MarketSmith.
Defensive Stock Eversource Energy Expects Growth
Eversource Energy also shows rising profit estimates. Growth is expected for the Northeastern utility provider. After earnings per share were reported at $3.61 in 2021, EPS projections are for $4.11 and $4.37 in 2022 and 2023, respectively.
Eversource Energy's first-quarter earnings on May 4 were strong, with EPS of $1.28 on revenue of $443.4 million, a nice 23% increase from a year prior.
Eversource's ambitious offshore wind project could drive growth further, although the project is under strategic review and the company is open to a possible sale. Nevertheless, the company could continue the project, especially after completing a $1.2 billion equity offering on May 11 to raise further capital.
Eversource is trading with a relative strength line at new highs as shares form a flat base with a 94.73 buy point.
Griffon Rallies On Pursuit Of Sale
Shares of Griffon shot higher last week after reports the company is looking into "strategic alternatives" that may include the sale of part of the company.
Since the jump, shares have been consolidating in a cup pattern and are trading near a 29.52 buy point. Although a relative strength line is near highs and fundamentals are strong — with Griffon having an IBD Composite Rating of 98 — caution is urged due to the ambiguity of the report. Over the last week, it has remained unclear the scope of changes or any interested parties.
