Yahoo Finance 3 Buy Rated Stocks Flexing Robust Growth: ANF, BMI, CHWY
Investors commonly have different preferences. Some people favor focusing on income, while others favor value.
Of course, some choose a growth-oriented strategy, concentrating on those with high expectations. It's important to remember that many growth stocks carry higher volatility, reflecting their explosive nature.
For those interested in the approach, three stocks – Abercrombie & Fitch ANF, Badger Meter BMI, and Chewy CHWY – should all catch your attention.
On top of robust growth, all three sport a favorable Zacks Rank, reflecting optimism among analysts. Let’s take a closer look at each.
Abercrombie & Fitch Posts Record Q1 Sales
Abercrombie & Fitch has jumped back into style in a big way, fully reflected by robust quarterly results. Over its last four releases, the apparel favorite has exceeded the Zacks Consensus EPS estimate by an average of 210%.
Analysts have become bullish following the results, raising their earnings expectations across the board and pushing the stock into the highly-coveted Zacks Rank #1 (Strong Buy). The revisions trend has been particularly bullish for its next upcoming release.
Image Source: Zacks Investment Research
The company just posted its highest-ever Q1 sales tally of $1.0 billion, up 22% on a year-over-year basis thanks to continued brand momentum. Growth was broad-based across regions and brands, with Abercrombie brands showing a 31% improvement from the year-ago period.
ANF raised its full year sales and operating margin outlook following the strong quarter, helping shares soar post-earnings. It’s worth noting that the company has seen a considerable margin turnaround overall, further illustrated below.
Please note that the chart is on a trailing twelve-month basis.
Image Source: Zacks Investment Research
Badger Meter Generates Strong Free Cash Flow
Badger Meter shares have been considerably strong over the last five years, providing a 28% annualized return over the period. The stock sports a Zacks Rank #1 (Buy), with earnings expectations moving positively across all timeframes.
Image Source: Zacks Investment Research
The company’s revenue growth has been remarkable, posting double-digit percentage year-over-year sales growth rates in five consecutive quarters. Sales of $196 million throughout its latest quarter jumped 24% year-over-year, driven by robust order pace across its solutions.
Image Source: Zacks Investment Research
BMI’s cash-generating abilities have also seen a nice boost, with free cash flow of $18.8 million throughout the period soaring 37% year-over-year. Improved cash generation can help support its quarterly dividend, currently yielding a modest 0.6% annually.
While the current yield has been taken lower by strong share performance, BMI’s 11.8% five-year annualized dividend growth rate reflects a notable commitment to increasingly rewarding shareholders.
Chewy Shares Roar Back
Chewy’s latest set of quarterly results pleased investors, with shares soaring post-earnings thanks to an 88% year-over-year pop in EPS. The stock was a darling during the 2021 market, seemingly being shoved to the side throughout 2022 and 2023.
The company’s earnings picture has brightened considerably. It’s worth noting that the steep share decline previously mentioned coincided with negative earnings estimate revisions, but shares are up 37% since the stock became a Zacks Rank #1 (Strong Buy) on May 24.
Image Source: Zacks Investment Research
Operational efficiencies have aided CHWY’s profitability nicely, with earnings forecasted to jump 38% in its current fiscal year (FY25). It’s worth noting that the company also recently announced a $500 million share repurchase program, which could help put in a floor for shares.
Like ANF, Chewy has seen margin expansion, further illustrated below.
Image Source: Zacks Investment Research
Bottom Line
Growth investors have enjoyed a positive environment in 2024, with many stocks enjoying big runs year-to-date thanks to a resilient economy.
And for those seeking a list of high-growth stocks, all three companies above – Abercrombie & Fitch ANF, Badger Meter BMI, and Chewy CHWY – fit the criteria.
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Abercrombie & Fitch Company (ANF) : Free Stock Analysis Report
Badger Meter, Inc. (BMI) : Free Stock Analysis Report
Chewy (CHWY) : Free Stock Analysis Report
