The Russell 1000 Index is a market-capitalization-weighted index of the 1,000 largest publicly traded companies in the U.S. It represents approximately 92% of the total market capitalization of all listed stocks in the U.S. equity market. For this reason, it is considered a bellwether for large-cap investing. Some of the largest companies in the index include Apple Inc. (AAPL), Johnson & Johnson (JNJ), and The Walt Disney Co. (DIS). The Russell 1000 provided a total return of 44.8% over the past 12 months. This market performance number and all data below are as of May 26, 2021.
Here are the top 5 stocks across all sectors with the best value, the fastest growth, and the most momentum.
Value investing is a factor-based investing strategy that involves picking stocks that you believe are trading for less than what they are intrinsically worth, usually by measuring the ratio of the stock’s price to one or more fundamental business metrics. A widely accepted value metric is the price-to-earnings (P/E) ratio. Value investors believe that if a business is cheap compared to its intrinsic value, in this case as measured by its P/E ratio, the stock price may rise faster than others as the price comes back in line with the worth of the company. These are the stocks with the lowest 12-month trailing P/E ratio.
- Agios Pharmaceuticals Inc.: Agios Pharmaceuticals is a biopharmaceutical company focused on cellular metabolism. The company develops medicines aimed at treating genetically defined diseases. The lead product candidate in the company’s clinical portfolio is mitapivat, which is designed to treat pyruvate kinase deficiency, thalassemia, and sickle cell disease. Agios reported a quarterly loss of $1.8 million or $1.31 per share in the first quarter of 2021.
- Annaly Capital Management Inc.: Annaly Capital Management is a diversified capital management company that invests in and finances residential and commercial assets. Its investment strategies include agency mortgage-backed securities, residential and commercial real estate, and middle market lending. The company has about $100 billion in total assets. Annaly announced in late March that it had agreed to sell its commercial real estate business for $2.33 billion to Slate Asset Management L.P., a global investment and asset management firm with a focus on real estate. The transaction is expected to be completed by the third quarter of 2021. Annaly reported earnings of $0.29 per share in the first quarter of 2021, up from $0.21 during the same period a year ago. The net interest income or the difference between income from its assets and expenses associated with them was $687.4 million, up from $51.1 million a year ago.
- AGNC Investment Corp.: AGNC Investment is an internally-managed real estate investment trust (REIT) that primarily invests in residential mortgage-backed securities (RMBS) whose principal and interest payments are guaranteed by the U.S. government. The company invests on a leveraged basis and finances its holdings through collateralized borrowings structured as repurchase agreements (repos). As of March 31, 2021, ANGC maintained a portfolio of about $90.3 billion in securities.
- Rocket Companies Inc.: Rocket Companies is a holding company that operates in the areas of personal finance and consumer services. The company provides real estate, mortgage, and financial services through brands including Rocket Homes, Rocket Auto, and Rocket Mortgage. Rocket Companies originated $320 billion in mortgages during fiscal year (FY) 2020. The company announced in early May financial results for Q1 FY 2021, which ended March 31, 2021. Net income rose 2,704.1% as revenue expanded 235.5% compared to the year-ago quarter. Total expenses increased at a much slower rate than revenue, helping to boost net income.
- Qurate Retail Inc.: Qurate Retail is an e-commerce service company concerned with making shopping more engaging. It partners with television networks, e-commerce sites, streaming services, social pages, mobile apps, print catalogs, and in-store destinations to provide video and digital commerce services. Qurate reaches 218 million homes and operates through seven retail brands, including QVC, HSN, Zulily, and Frontgate.
These are the top stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and their most recent quarterly YOY earnings per share (EPS) growth. Both sales and earnings are critical factors in the success of a company. Therefore ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one or the other figure unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of over 2,500% were excluded as outliers.
- Zoom Video Communications Inc.: Zoom Video Communications is a communications technology company that provides a video-first communication platform and web conferencing services. Its cloud platform offers video, voice, content sharing, and chat for mobile devices, desktops, telephones, and room systems. Customers can engage in one-on-one chats or conduct large-scale online events with up to 10,000 view-only attendees.
- Tesla Inc.: Tesla is the world’s largest automaker by market value, with a market cap of about $596 billion, and is one of the world’s leading manufacturers of electric vehicles. The company designs and manufactures fully electric vehicles, including luxury and mass-market sedans and trucks. It also is a clean energy company and produces solar energy generation and energy storage products. Tesla announced in early April that it had produced 180,338 vehicles and delivered 184,800 vehicles in the first quarter of FY 2021. It announced record profits of $438 million or $0.93 per share during the first quarter of 2021.
- The Cooper Companies Inc.: CooperCompanies is a global medical device company. It operates through two separate business units: CooperVision, which develops a range of products for contact lens wearers and provides focused support to practitioners; and CooperSurgical, which is focused on advancing the health of women, babies, and families through its portfolio of products and services focused on medical devices and fertility & genomics. The company employs more than 12,000 people and its products are sold in over 100 countries. CooperCompanies announced in early May that it had acquired obp Medical Corp., a medical device company, for approximately $60 million.
- Boston Scientific Corp.: Boston Scientific is a global developer and manufacturer of medical devices used in a broad range of interventional medical specialties. Its products are used to aid in diagnosing or treating complex diseases and conditions across multiple fields, including cardiovascular, respiratory, digestive, neurological, urological and pelvic health. The company employs 38,000 people globally and its products are used to treat approximately 30 million patients each year.
- Fifth Third Bancorp: Fifth Third Bancorp is a diversified financial services company. It operates through four main businesses, including commercial banking, branch banking, consumer lending, and wealth & asset management. The company operates 1,098 full-service banking centers and had $207 billion in assets as of March 31, 2021. The revenue growth figure in the table above is based on Fifth Third Bancorp’s GAAP revenue. However, the company reports adjusted non-GAAP revenue in its earnings releases. This non-GAAP figure uses a full-tax-equivalent (FTE) adjustment, which means the bank takes the tax-equivalent yield and adjusts the yield on its non-taxable securities, such as muni bonds, so as to account for the tax savings that such securities provide. While this is a standard adjustment in the banking industry, we are looking at GAAP figures, because we are comparing Fifth Third to non-bank companies as well as banks.
Momentum investing is a factor-based investing strategy that involves investing in a stock whose price has risen faster than the market as a whole. Momentum investors believe that stocks that have outperformed the market will often continue to do so because the factors that caused them to outperform will not suddenly disappear. In addition, other investors, seeking to benefit from the stock’s outperformance, will often purchase the stock, further bidding its price higher and pushing the stock higher still. These are the stocks that had the highest total return over the last 12 months.
- Freeport-McMoRan Inc.: Freeport-McMoRan is an international mining company that produces copper, gold, and molybdenum. It mines a large copper and gold mining deposit in Indonesia. The company also has seven open-pit copper mines in North America, and a range of other mining operations in South America, including open-pit mining and sulfide ore concentrating. The company reported earnings of $718 million in the first quarter of 2021, a reversal from losses of $491 million a year ago, during the first quarter of 2021. Its revenue jumped to $4.8 billion, a jump of 73.3% from 2020 figures.
- Olin Corp.: Olin is a vertically-integrated global manufacturer and distributor of chemical products. It also owns Winchester, a U.S. manufacturer of ammunition products. Its chemical products include chlorine and caustic soda, vinyls, epoxies, chlorinated organics, bleach, and hydrochloric acid. Winchester produces and distributes sporting ammunition, law enforcement ammunition, reloading components, and related products. The company employs 8,000 professionals in over 20 countries.
- L Brands Inc.: L Brands is a specialty retail business focused on women’s intimate and other apparel, personal care, and beauty categories. The company operates through three core brands: Bath & Body Works, a specialty retailer offering a range of fragrances for the home and body; Victoria’s Secret, a specialty retailer of bras, panties, lingerie, beauty products, and more; and PINK, a lifestyle brand that offers loungewear, knit tops, bras, panties, activewear, accessories, and more. The company recently announced that it plans to separate Bath & Body Works and Victoria’s Secret into two separate companies. L Brands expects to do a tax-free spin-off of Victoria’s Secret to L Brands’ shareholders.
- Gap Inc.: Gap is a global retailer of apparel, accessories, and personal care products, with brands including Old Navy, Gap, Banana Republic, and Athleta. The retailer also offers an assortment of products for men, women, and children through its Intermix, and Janie and Jack brands. It sells its products both in stores and online. Gap announced in late March that it was planning on selling its Janie and Jack brand to Go Global Retail, an investment platform in the fashion and consumer brand sector. Financial terms of the transaction were not disclosed. Gap reported earnings of $0.48 per share in the first quarter of 2021 on revenues of $3.99 billion. The company has raised its sales estimates for the full year but still faces supply chain challenges resulting from the pandemic shutdown.
- Tesla Inc.: See above for company description.
The comments, opinions, and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or to adopt any investment strategy. While we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described on our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.