Hopes of additional fiscal stimulus and faster deployment of the vaccine propelled the U.S. stock market to close at record highs on Jan 20 as Joe Biden was sworn in as the 46th president of the United States. Notably, Biden already proposed a COVID-19 fiscal relief package amounting to $1.9 trillion.
The package aims to provide further support to the citizens of the country and calls for more direct payments of $1,400 to most Americans, bringing the sum total of direct payments to $2,000 as it includes the previous $600 payments. Such a positive development is sure to be beneficial for the economy and in turn, the stock market as it is fundamentally linked to the performance of the economy.
The package also includes $50 billion toward COVID-19 testing as well as a proposed $20 billion toward a national vaccine program to be conducted in partnership with states, localities and tribes. Meanwhile, Treasury Secretary nominee Janet Yellen also urged for additional relief efforts during her confirmation hearing before the Senate Finance Committee. Yellen noted that the bigger stimulus bill would likely have an impact on the national debt. However, given the historic low interest rates, she urged the lawmakers to “act big.”
In fact, the U.S. economy has been witnessing a turnaround in recent months following the slump during the early part of last year. Per the Institute for Supply Management, the manufacturing purchasing managers’ index (“PMI”) was reported at 60.7% in December compared to 57.5% in November. Notably, this marked the eighth consecutive month of expansion. Meanwhile, the services PMI also registered growth for the seventh successive month in December and was reported at 57.2% compared to 55.9% in November.
Reflective of the continued expansion in both manufacturing and services sector, the U.S. economy also seems poised to return to its growth path in 2021. Notably, the Conference Board estimated that the U.S. GDP will witness an annual expansion of 4.1% in 2021, following an estimated contraction of 3.5% in 2020.
5 Top Growth Stocks to Buy Now
The U.S. economy seems to be on a cusp of complete recovery following hopes of additional fiscal stimulus, including focus on COVID-19 testing and vaccination. Moreover, the economy has already witnessed expansion in both the manufacturing and services sector over the past few months while the GDP of the country is also estimated to rebound in 2021. This makes it a good time to invest in growth stocks that have the ability to make the most of this potential going forward. Our research shows that stocks with Growth Score of A or B when combined with a Zacks Rank #1 (Strong Buy) or 2 (Buy) offer the best opportunities for investing in the growth space. Hence, we have handpicked five such stocks. You can see the complete list of today’s Zacks #1 Rank stocks here.
AGCO Corporation AGCO manufactures and distributes agricultural equipment and related replacement parts worldwide. The company currently has a Zacks Rank #1 and Growth Score of B. The Zacks Consensus Estimate for its current-year earnings increased 4.9% over the past 60 days. The company’s expected earnings growth rate for the current year is 21.1%.
Deere & Company DE, together with its subsidiaries, manufactures and distributes various equipment worldwide. The company operates through three segments: Agriculture and Turf, Construction and Forestry, and Financial Services. It currently has a Zacks Rank #1 and Growth Score of A. The Zacks Consensus Estimate for its current-year earnings increased 21.1% over the past 60 days. The company’s expected earnings growth rate for the current year is 50.9%.
Myers Industries, Inc. MYE manufactures and sells polymer products for industrial, agricultural, automotive, commercial, and consumer markets in the United States and internationally. The company currently has a Zacks Rank #1 and Growth Score of B. The Zacks Consensus Estimate for its current-year earnings increased 14% over the past 60 days. The company’s expected earnings growth rate for the current year is 16.5%.
Liquidity Services, Inc. LQDT provides e-commerce marketplace that enable buyers and sellers to transact in an automated environment. The company currently has a Zacks Rank #2 and Growth Score of A. The Zacks Consensus Estimate for its current-year earnings increased more than 100% over the past 60 days. The company’s expected earnings growth rate for the current year is more than 100%.
CoreLogic, Inc. CLGX, together with its subsidiaries, provides property information, insight, analytics, and data-enabled solutions in North America, Western Europe, and the Asia Pacific. The company currently has a Zacks Rank #2 and Growth Score of B. The Zacks Consensus Estimate for its current-year earnings increased 9.8% over the past 60 days. The company’s expected earnings growth rate for the current- year is 10.7%.
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