Momentum investing is essentially an exception to the idea of ​​”buying low and selling high.” Investors who follow this investing style are typically not interested in betting on cheap stocks and waiting a long time for them to recover. Instead, they believe that “buying high and selling higher” is the way to make a lot more money in a shorter period of time.

Everyone likes to bet on fast-moving trending stocks, but it is not easy to determine the right time to enter. These stocks often lose momentum when their future growth potential does not justify their inflated valuation. During this phase, investors invest in stocks that have limited or no upside potential or even downside potential. Therefore, betting on a stock based only on traditional momentum parameters can sometimes be risky.

A safer approach might be to invest in cheap stocks with current price momentum. While the Zacks Momentum Style Score (part of the Zacks Style Scores system) helps identify great momentum stocks by closely monitoring trends in a stock’s price or earnings, our Fast Momentum at Bargain Prices screen is handy for spotting fast-moving stocks that are still attractively valued.

There are several stocks that are currently running through the filter and Cemig (CIG) is one of them. Here are the top reasons why this stock is a great candidate.

Growing investor interest in a stock is reflected in its recent price increase. An 8% price change over the past four weeks positions this utility company’s stock well in this regard.

While any stock can see a short-term increase in price, it takes a true momentum player to deliver positive returns over a longer period of time. CIG fits this criteria as well, with the stock up 9.7% over the past 12 weeks.

Furthermore, momentum is rapid for CIG as the stock currently has a beta of 1.29, meaning the stock has 29% upside in either direction compared to the market.

Given this price action, it is no surprise that CIG has a Momentum Score of A, indicating that this is the right time to enter the stock to take advantage of the momentum with the highest probability of success.

In addition to a favorable Momentum Score, an uptrend in earnings estimate revisions has helped CIG earn a Zacks Rank #2 (Buy). Our research shows that the momentum effect is quite strong for Zacks Rank #1 and #2 stocks. That’s because when analysts increase their earnings estimates for a stock, more investors become interested in it, which helps the price keep up. You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here >>>>

The story continues

Most importantly, despite its rapid momentum, CIG is trading at a reasonable price. Based on the price-to-sales ratio, which is considered one of the best valuation metrics, the stock currently looks quite cheap. CIG is currently trading at 0.82 times its sales. In other words, investors only have to pay 82 cents for every dollar of sales.

So CIG seems to have plenty of room to grow, and at a rapid pace.

Besides CIG, there are several other stocks that currently pass through our Fast-paced momentum at a bargain price filter. You can consider investing in these and look for the latest stocks that meet these criteria.

This isn’t the only screen that can help you find your next winning stock pick. Based on your personal investing style, you can choose from over 45 Zacks Premium screens that are strategically designed to beat the market.

However, remember that the key to a successful stock-picking strategy is to make sure it has a history of producing profitable results. You can do this easily with the help of the Zacks Research Wizard. The program not only allows you to test the effectiveness of your strategy, but also includes some of our most successful stock-picking strategies.

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Comp En De Mn Cemig ADS (CIG): Free Stock Analysis Report

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