5 Broker-Friendly Stocks to Watch as Markets Move North Amid Shutdown

Ignoring a government shutdown and lingering concerns about inflation, the broader equity markets have been hitting record highs lately. The shutdown, which has resulted in the furlough of several thousand federal employees, has not hindered the stock market’s upward momentum, as investors anticipate the disruption to be brief. Also, expectations of more interest rate cuts by the Fed in 2025 have increased due to weak labor market conditions.

Investors would like to take advantage of this northward movement of stocks by designing a portfolio to ensure healthy returns. However, with a plethora of stocks flooding the market at any point in time, it is by no means an easy task for individual investors to design a winning portfolio of stocks.

One way to move forward is to follow broker advice, as brokers are deemed experts in the field of investing, with thorough knowledge of the market's intricacies. Following this route, broker-friendly stocks like Bread Financial BFH, Delek US Holdings DK, American Eagle Outfitters AEO, Advance Auto Parts AAP and Archer Daniels Midland Company ADM should be monitored for healthy returns.

We have designed a screen to shortlist stocks based on improving broker recommendations and upward revisions in earnings estimates over the past four weeks. Also, since the price/sales ratio is a strong complementary valuation metric in the presence of broker information, it has been included. The price/sales ratio takes care of the company’s top line, making the strategy a well-rounded one.

Screening Parameters    

# (Up- Down Rating)/ Total (4 weeks) =Top #75 (This gives the list of top 75 companies that have witnessed net upgrades over the last 4 weeks).

% change in Q (1) est. (4 weeks) = Top #10 (This gives the top 10 stocks that have witnessed earnings estimate revisions over the past 4 weeks for the upcoming quarter).

Price-to-Sales = Bot%10 (The lower the ratio, the better. Companies meeting this criterion are in the bottom 10% of our universe of over 7,700 stocks concerning this ratio).

Current Price greater than 5 (as a stock trading below $5 will not likely create significant interest for most of the investors).

Average Daily Volume greater than 100,000 shares over the last 20 trading days (Volume has to be significant to ensure that these are easily traded).

Market value ($ mil) = Top #3000 (This gives us stocks that are the top 3000 in terms of market capitalization).

Com/ADR/Canadian= Com (This eliminates the ADR and Canadian stocks).

Here are five of the 10 stocks that made it through the screen:

Bread Financial is based in Columbus, OH. The company continues to benefit from data-driven marketing strategies. Solid receivables growth in Card Services should drive its top line. Acquisitions and divestitures will aid the company in growing inorganically and expanding its international footprint.

BFH outpaced the Zacks Consensus Estimate for earnings in three of the last four quarters and missed once. The average beat is 32%. Bread Financial currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here

Delek US Holdings is a Brentwood, TN-based oil and gas refining and marketing company. DK’s extensive downstream operations within the Permian Basin grant it a fairly significant competitive edge over its peers in the long term.

Delek US Holdings currently carries a Zacks Rank #3. DK beat the Zacks Consensus Estimate for earnings in three of the last four quarters and missed once, the average beat being 16.1%. 

American Eagle remains well placed on the back of cost-reduction efforts and brand progress. In addition, its Powering Profitable Growth plan bodes well. American Eagle is actively executing its strategic initiatives, aimed at driving long-term growth, enhancing operational efficiency and improving agility. The company has been investing in its digital platform to grow its e-commerce business and enrich customer experience.

American Eagle currently carries a Zacks Rank #3. DK beat the Zacks Consensus Estimate for earnings in three of the last four quarters and missed once, the average beat being 16.1%. 

Advance Auto achieved a key strategic milestone by completing its store footprint optimization program in March 2025. Over the next three years, it plans to open more than 100 new stores and expects to further accelerate growth. Its efforts to consolidate its supply chain into a single unified network bode well.

Advance Auto currently carries a Zacks Rank #3. AAP beat the Zacks Consensus Estimate for earnings in three of the last four quarters and missed once.

Archer Daniels is based in Chicago, IL. This agricultural product company’s leadership in critical global trends, such as flexitarian diets, nutrition and sustainable materials, has contributed to its momentum. Its focus on investing in assets and technological capabilities to serve customers efficiently is likely to be a significant growth driver. 

This Zacks Rank #3 company has been progressing well on its three strategic pillars — optimize, drive and growth. ADM beat the Zacks Consensus Estimate for earnings in three of the last four quarters and missed once. The average beat is 0.05%.

You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.

The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.

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Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

Disclosure: Performance information for Zacks’ portfolios and strategies are available at: https://www.zacks.com/performance.

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This article originally published on Zacks Investment Research (zacks.com).

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