While following the trend is generally a good strategy for short-term investing and trading, timing entries is crucial for success. Ensuring the trend’s sustainability can be challenging, as reversals often occur before exiting trades, resulting in losses. To increase the likelihood of a profitable trade, it’s essential to confirm factors like strong fundamentals, positive earnings estimate revisions, and other indicators that suggest continued momentum.
Zacks’ “Recent Price Strength” screen, based on a unique short-term trading strategy, can be a valuable tool for identifying stocks with the potential to maintain their upward trend. This screen filters for stocks with strong fundamentals that are trading near their 52-week highs, a bullish indicator.
Sezzle Inc. (SEZL) is one such stock that has passed this screen, demonstrating several compelling reasons for trend investors to consider it.
SEZL has experienced a solid price increase over the past 12 weeks, reflecting continued investor confidence in the stock’s potential. The stock has gained 55.7% during this period. However, simply looking at three months of price change doesn’t guarantee trend sustainability. A shorter-term perspective is needed to assess recent momentum.
Over the past four weeks, SEZL has risen by an impressive 48%, reinforcing the ongoing upward trend. Moreover, the stock is currently trading at 88% of its 52-week high-low range, suggesting potential for a breakout.
Looking beyond price action, SEZL boasts a Zacks Rank #1 (Strong Buy), placing it within the top 5% of over 4,000 stocks ranked by Zacks. This ranking is based on trends in earnings estimate revisions and EPS surprises, key factors driving near-term stock price movements. The Zacks Rank system has a proven track record, with Zacks Rank #1 stocks achieving an average annual return of +25% since 1988.
Further supporting SEZL’s fundamental strength is its Average Broker Recommendation of #1 (Strong Buy), signifying high optimism among analysts regarding the stock’s near-term price performance.
The combination of a strong price trend and positive fundamentals suggests that SEZL’s upward momentum is likely to continue, making it a compelling option for trend-focused investors.
