Many investors like to look for momentum in stocks, but this can be very tough to define. There is great debate regarding which metrics are the best to focus on in this regard, and which are not really quality indicators of future performance. Fortunately, with our new style score system we have identified the key statistics to pay close attention to and thus which stocks might be the best for momentum investors in the near term.
This method discovered several great candidates for momentum-oriented investors, but today let’s focus in on Facebook, Inc. (FB – Analyst Report) as this stock is looking especially impressive right now. And while there are numerous ways in which this company could be a great choice, we have highlighted three of the most vital reasons for FB’s status as a solid momentum stock below:
Longer Term Price Change for Facebook
While any stock can see a spike in price, it takes a real winner to consistently outperform the market. That is why looking at longer term price metrics—such as performance over the past three months or year– and comparing these to an industry at large can be very useful.
And in the case of FB, the results are quite impressive. The company has beaten out the industry at large over the past 12 weeks by a margin of 6.2% to -12.3% while it has also outperformed when looking at the past year, putting up a gain of 52%. Clearly, FB is riding a bit of a hot streak and is worth a closer look by investors.
Quarter EPS Estimate Change for Facebook Stock
While looking at price performance or full year earnings can be essential to understanding a momentum stock, you shouldn’t forget about the current quarter EPS and the trend in estimates there. This change can signal how a stock might perform in the next earnings season which is obviously vital for momentum investors.
Right now, FB is seeing a nice trend over the past month when it comes to this quarter’s earnings estimate projections. In the time frame, EPS estimates for Facebook have gone up by 12.5% compared to a flat industry average move, suggesting that not only is FB heading in the right direction, but it is seeing an increase relative to the industry too.
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