Top Stocks for April 2023

Sinclair Broadcast Group Inc., Gevo Inc., and Enlight Renewable Energy Ltd. are the top performers for value, growth, and momentum, respectively.

In February, Sinclair Broadcast Group announced its over-the-air free television networks TBD, COMET, and CHARGE! have garnered an average daily viewership of 2.6 million and a 30% primetime audience increase.

Gevo Inc. finalized a fuel sales agreement with Iberia Airlines and Qatar Airways late last year for a combined 11 million gallons of sustainable aviation fuel (SAF) per year for five years.

Since its initial public offering in February, Enlight Renewable Energy has seen its share price increase over 700%, riding a wave of interest in renewable energy stocks after last summer's Inflation Reduction Act of 2022.

These stocks are leading their categories while the Russell 3000 Index, a broad measure of the U.S. stock market, is down almost 20% from its all-time high in January 2022. Many companies in the index are grappling with a slowing economy, inflation, and a series of rate hikes by the Federal Reserve. The banking crisis, set off in early March with the collapse of Silicon Valley Bank, has only added to the challenges facing companies and investors.

Below, we list the top five stocks in each category: value, growth, and momentum. These rankings are based on an Investopedia analysis of YCharts data. All company data are as of March 22, while index data are as of March 26.

Best Value Stocks

Value investing is a factor-based investing strategy that involves picking stocks that you believe are trading for less than what they are intrinsically worth, usually measured by the ratio of the stock’s price to one or more fundamental business metrics. A widely accepted value metric is the price-to-earnings (P/E) ratio. Value investors say that if a business is cheap compared with its intrinsic value (as measured by its P/E ratio, in this case), then the stock price may rise faster than others' as the price comes back in line with the worth of the company. These are among the stocks with the lowest 12-month trailing P/E ratio.

^{Source: YCharts}

• Sinclair Broadcast Group Inc.: Sinclair Broadcast Group is a media company broadcasting local and network-provided content, such as professional sports and entertainment programming. On Feb. 22, Sinclair Broadcast Group announced a quarterly dividend of $0.25 per share for stockholders. The dividend is payable on March 17 to shareholders of record as of March 3.
• Cemex S.A.B. de C.V.: Located in Mexico, Cemex provides building materials such as ready-mix concrete, asphalt products, roofing tiles, drainage basin barriers, and concrete pipes for sewer systems. Cemex recently made headlines when competitor Vulcan Materials, the largest construction aggregates producer in the U.S., alleged Mexican police seized its quarry in the Mexican province of Quintana Roo and allowed Cemex to unload cargo at the site. Cemex leased part of the port until December when its agreement with Vulcan expired and the companies failed to agree on a renewal.
• Jackson Financial Inc.: Jackson Financial is a financial services company providing investment products primarily for retirement, such as variable and fixed payout annuities and whole, term, and variable life insurance policies. On Feb. 28, Jackson Financial reported a net loss of $718 million in the fourth quarter of 2022.
• ZIM Integrated Shipping Services Ltd.: ZIM Integrated Shipping Services is an Israel-based container transportation and logistics company providing cargo for approximately 100 countries worldwide.
• ECN Capital Corp.: ECN Capital Corp is a Canada-based business services company providing management and advising expertise on credit assets such as manufactured housing, recreational vehicle, and marine and commercial loans.

Fastest-Growing Stocks

These are the top stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly year-on-year (YOY) percentage revenue growth and their most recent quarterly YOY earnings per share (EPS) growth.

Both sales and earnings are critical factors in the success of a company. Therefore, ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one or the other figure unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of more than 1,000% were excluded as outliers.

^{Source: YCharts}

• Gevo Inc.: Gevo is a green energy company that sells alternative fuels, such as sustainable aviation fuel, renewable gasoline and diesel, renewable natural gas, and ethanol. Note Gevo doesn't have an EPS growth figure in the table above because the company reported negative EPS in the most recent quarter.
• Lucid Group Inc.: Lucid Group produces luxury electric vehicles such as their flagship model Lucid Air and soon-to-released model Lucid Gravity. On Feb. 22, fourth-quarter earnings were released by the company. Net losses were cut in half from just over $1 billion to $473 million. Lucid also produced 3,493 vehicles in Q4, up 53% from the prior quarter. Note Lucid Group doesn't have an EPS growth figure in the table above because the company reported negative EPS in the most recent quarter.
• Mirum Pharmaceuticals Inc.: Mirum Pharmaceuticals identifies, develops, and commercializes novel therapies for rare diseases. Their main product is Livmarli for the treatment of Alagille syndrome. On March 14 the FDA approved Livmarli for infants three months old. The medicine was previously only approved for children at least 1 year of age. Note Mirum Pharmaceuticals doesn't have an EPS growth figure in the table above because the company reported negative EPS in the most recent quarter.
• Fisker Inc.: Fisker is an electric vehicle manufacturer with plans to release its first line of Fisker Ocean vehicles sometime this year. On Feb. 23, Fisker named ChargePoint Holdings its North American partner for its public charging stations, including over 210,000 active ports for Fisker EV owners. Note Fisker doesn't have an EPS growth figure in the table above because the company reported negative EPS in the most recent quarter.
• Nano Dimension Ltd.: Nano Dimension is an Israel-based producer of fabricated additive electronics. On March 9, Nano Dimension announced its offer to acquire a 3D printing company focused on polymer-based products called Stratasys Ltd. for $18.00 per share, for a total of $1.1 billion. Note Nano Dimension doesn't have an EPS growth figure in the table above because the company reported negative EPS in the most recent quarter.

Stocks With the Most Momentum

Momentum investing is a factor-based investing strategy that involves buying a stock whose price has risen faster than the market as a whole. Momentum investors believe that stocks that have outperformed the market will often continue to do so because the factors that caused them to outperform will not suddenly disappear.

In addition, other investors seeking to benefit from the stock’s outperformance will often purchase it, further bidding its price higher. These are the stocks that had the highest total return over the past 12 months.

^{Source: YCharts}

• Enlight Renewable Energy Ltd.: Enlight Renewable Energy is an Israel-based renewable energy company with solar energy projects, wind farms, and other integrated energy systems in Europe and the U.S. On March 15, Enlight Renewable Energy released its fourth-quarter earnings results. Net income increased by 76%, with total revenue growth of 88%.
• TORM PLC.: TORM, located in the U.K., is a pure-play tanker company that transports petroleum-based products worldwide.
• Verona Pharma PLC.: Verona Pharma is a biopharmaceutical company based in the U.K. specializing in developing various therapies for treating respiratory diseases such as COPD, cystic fibrosis, and asthma.
• Ventyx Biosciences Inc.: Ventyx Biosciences is a biopharmaceutical company that develops and commercializes oral medication for treating autoimmune diseases.
• Ardelyx Inc.: Ardelyx produces medications for individuals with gastrointestinal diseases. Its primary product is Ibsrela, an oral medication to help treat irritable bowel syndrome.

Top Stock Investing Advantages

Momentum

To become a top stock, a company most likely produces positive trends in its earnings, revenue, and share price. Momentum in these areas indicates a well-run business that has the potential to keep generating a profit and to create shareholder value.

Investors can use free stock screening sites like Finviz to find top stocks, filtering by both fundamental and technical momentum. For example, a trader could find a top stock by scanning for companies that are trading at a new 52-week high or that have grown their earnings consistently over the past five years.

Liquidity

Top stocks typically receive extensive media coverage and are followed by leading Wall Street analysts. This usually means more liquidity in the order book, leading to better prices and faster trade executions. Moreover, top stocks with ample liquidity are more difficult for larger players to manipulate, helping to keep a fair and orderly market.

Top Stock Investing Risks

Missed Opportunities

Investing only in top large-cap stocks means that investors may miss profitable opportunities in other areas of the stock market. Some of the most significant gains come from small-cap stocks under the radar. For example, an unknown small biotechnology company may announce a breakthrough discovery that propels its share price higher. Even if investors favor trading top stocks, allocating a portion of capital to other stock groups helps avoid missing compelling opportunities.

Trend Reversals

The trend is your friend—until it's not. Even large-cap top stocks with a track record of earnings growth and creating shareholder value encounter unforeseen challenges. For example, cruise line companies, such as Carnival Corp. (CCL) and Norwegian Cruise Line Holdings Ltd. (NCLH), reported increased revenue in the years leading up to the COVID-19 pandemic but watched their top line sink to unprecedented lows for several years due to no-sail orders and a collapse in passenger demand.

When investing in top stocks, investors should always use a stop-loss order to protect against sudden trend reversals.

The comments, opinions, and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or adopt any investment strategy. Though we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described in our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.