Investors often seek out growth stocks in order to take advantage of above-average growth potential that can lead to exceptional returns in the market. However, finding a growth stock that lives up to its true potential can be a challenging task. These stocks typically come with above-average risk and volatility, and investing in a company whose growth story is ending can result in significant losses.
One way to make the task of finding cutting-edge growth stocks easier is by using the Zacks Growth Style Score. This system goes beyond traditional growth attributes to analyze a company’s true growth prospects. One such stock that is currently recommended by this system is Ezcorp (EZPW). Not only does this company have a favorable Growth Score, but it also holds a top Zacks Rank.
Research has shown that stocks with strong growth features tend to outperform the market. When a stock has a combination of a Growth Score of A or B and a Zacks Rank of #1 (Strong Buy) or 2 (Buy), the returns are even better.
Here are three key factors that make Ezcorp a great growth pick at the moment:
1. Earnings Growth: Earnings growth is crucial for investors, as it is often an indicator of strong prospects for the company. Ezcorp has a projected EPS growth of 20.7% this year, surpassing the industry average of 12.6%.
2. Cash Flow Growth: Cash flow growth is essential for growth-oriented companies, as it allows them to expand without relying on external funds. Ezcorp’s year-over-year cash flow growth is at 17.8%, higher than many of its peers.
3. Earnings Estimate Revisions: Positive trends in earnings estimate revisions can further validate a stock’s potential. Ezcorp has seen upward revisions in current-year earnings estimates, with the Zacks Consensus Estimate for the current year increasing by 5.7% over the past month.
In conclusion, Ezcorp has a Growth Score of B and a Zacks Rank #2, making it a potential outperformer and a solid choice for growth investors.