Finding companies with the criteria you want isn’t always easy. You could spend hours searching ticker after ticker, only to find companies which aren’t worthy of your hard earned cash. An easier way to navigate through this is by using high quality stock screeners. Screening helps investors narrow down companies to invest in based on their ability to meet every criteria selected. Any company who misses even one of the criteria requirements will be filtered out.
This lets one easily choose ideal metrics. Screens are effective because they sift out bad stocks and only keep the cream of the crop in. It isn’t always easy to create an effective screen. Our Zacks Premium Screens have helped with this, bringing profits to many investors over time. Our predefined criteria are chosen carefully to capture special kinds of companies.
Today, we’ve dug up five tech stocks using one of our premium screens known as “Sales & Earnings Growth Winners”. Some of the metrics of this screen requires a stock to have a growth score of “B” or better in our Style Scores, projected sales growth greater than 10% this year, and expected earnings growth north of 10% this year. The technology industry always has candidates experiencing significant share price growth, and these buy-ranked stocks look set to experiencing more sales and earnings appreciation as they move forward. This should help them a lot with regards to being among the tech companies who see massive share price gains over the short term.
Arista Networks Inc-ANET
Arista Networks provides cloud networking solutions for datacenter and cloud computing environments. Among the solutions offered are Ethernet switches, transceivers, pass-through cards, enhanced operating systems, and more. Arista is a Zacks Rank #1 (Strong Buy), and it receives a growth score of “A” in our Style Scores. The company is expected to see sales growth of 43.4% this year, and its earnings are projected to increase by 18.47% in 2016.
Over the last two months, our EPS consensus estimate for this quarter has increased, going from $0.50 to $0.56. No analysts have posted a negative EPS revision for Arista Networks for this year or next year over the last three months. It should be noted that Arista has beaten our EPS consensus in each of the last four quarters.
Globant focuses on providing clients with engineering, design, and innovation services. They also offer content management systems and e-commerce applications. The company has a hand in testing for multiple industries, from gaming, to automotive, and even mobile. Globant is a Zacks Rank #1 (Strong Buy), and it has an “A” for growth in our Style Scores. GLOB is expected to see sales growth of about 27% this year. Its earnings are also projected to grow by a significant clip this year, with EPS expected to rise by 21.98% compared to last year.
Globant has met or beaten our EPS consensus estimate in each of the last four quarters. Over the last 3 years, annual revenues have grown by about 61%. In that same time span, net income has more than doubled. GLOB has gained considerable momentum, and its shares have climbed up 17.78% over the last twelve weeks.
Mitek Systems Inc-MITK
Mitek develops and sells software products with a focus on intelligent character recognition and forms processing technology. Their technology allows people to take pictures of checks and deposit them. It also has solutions for facial recognition technology. MITK is a Zacks Rank #2 (Buy), and it gets an “A” for growth. The company’s sales are expected to grow by 32.81%, and earnings are projected to surge by 950% compared to fiscal 2015.
Mitek’s Q2 2016 sales were 50% higher than sales from the same quarter last year. The company’s revenues have more than doubled since 2012, and the growth story for Mitek looks like it is just beginning. The company has a consistent record for crushing our EPS consensus estimate. As a matter of fact, MITK has topped our EPS estimate by at least 120% every quarter over the last four quarters.
Paycom Software Inc-PAYC
Paycom Software provides cloud-based human capital management software solutions delivered as Software-as-a-Service. It helps companies manage the complete employment life cycle from recruitment to retirement. Its solutions offer applications in the areas of talent acquisition, time and labor management, and payroll. PAYC is a Zacks Rank #2 (Buy), and it makes the grade of “A” for growth. The company’s sales are projected to grow by 43% this year. Earnings are expected to see even more growth, with a projected increase of 80% in 2016.
Paycom has seen its margins continue to improve, and its gross profit margin has gone from 82% to 84% between 2014 and 2015. In the last two fiscal years, Paycom’s net income has more than tripled. Over the last two months, our current year EPS consensus estimate has grown, going from $0.53 to $0.67. It is possible that PAYC will surpass this estimate, since the company has a track record of beating our earnings estimates. The company has topped our consensus estimate in each of the last four quarters.
Silicon Motion Technology Corporation-SIMO
Silicon Motion focuses on making and marketing universally compatible and low-power semiconductor solutions for the multimedia consumer electronics market. SIMO is a Zacks Rank #2 (Buy), and it has earned an “A” for growth. The company is expected to realize revenues growth of 32.95% this year. Earnings are projected to increase at a similar clip, with EPS expected to grow by 29.3% this year.
SIMO posts a trailing twelve month net margin of 18.02%, and this is way ahead of the industry’s net margin of just 1.44%. Last year, the company’s net income grew by over 36%, and sales rose by about 25%. What’s really notable about Silicon Motion’s stock is the fact that it trades at an attractive valuation. The company has a PEG of 0.91, which suggests that the company may be undervalued.
One magical screening ingredient which can’t be overlooked is a Zacks Rank #2 (Buy) or better. The rank helps to find companies which look like dependable earnings candidates. In addition to this great metric, the Zacks Premium Screens help you to add other criteria to find the most superior investment choices. While this article outlined potential candidates from one screen, the Zacks Premium service gives you access to the Zacks #1 Growth Stocksand 45 other premium screens designed to give you superior investment returns.
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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report PAYCOM SOFTWARE (PAYC): Free Stock Analysis Report GLOBANT SA (GLOB): Free Stock Analysis Report ARISTA NETWORKS (ANET): Free Stock Analysis Report SILICON MOTION (SIMO): Free Stock Analysis Report MITEK SYSTEMS (MITK): Free Stock Analysis Report To read this article on Zacks.com click here.