• Thu. Nov 24th, 2022

Which makes California Bank of Commerce (CALB) a good choice for “trend investing.”

ByPatricia S. Stevens

Nov 24, 2022

When it comes to short-term investing or trading, the saying goes, “trend is your friend”. And there is no denying that this is the most profitable strategy. But ensuring the sustainability of a trend in order to capitalize on it is easier said than done.

The trend often reverses before exiting the trade, resulting in a short-term loss of capital for investors. So, for a profitable trade, one should confirm factors like solid fundamentals, positive revisions of earnings estimates, etc. that could keep the momentum of the stock alive.

Our Recent Price Strength screen, based on a unique short-term trading strategy, could be quite useful in this regard. This predefined screen makes it really easy to shortlist stocks that have enough fundamental strength to sustain their recent uptrend. Also, the screen only passes stocks trading in the upper part of their 52-week high-low range, which is usually an indicator of bullishness.

There are several stocks that have passed the screen and California Merchant Bank (CALB) is one of them. Here are the main reasons why this stock is a solid pick for “trend” investing.

Solid price gains over a 12-week period reflect investors’ continued willingness to pay more for a stock’s potential upside potential. CALB fits in pretty well in this regard, gaining 19% over the period.

However, it is not enough to look at the price change for about three months as it does not reflect a trend reversal that may have occurred on a shorter time frame. Maintaining the price trend is important for a potential winner. A 14.1% price gain over the last four weeks means this company’s stock is continuing its trend.

Additionally, CALB is currently trading at 93.3% of its 52-week high-low range, suggesting it could be on the verge of a breakout.

Looking at fundamentals, the stock currently has a Zacks rank of #1 (Strong Buy), meaning it is in the top 5% of more than 4,000 stocks we have covered based on trends in earnings estimate revisions and EPS Surprises classify key factors influencing a stock’s short-term price movements.

The Zacks Rank stock rating system, which uses four factors related to earnings estimates to categorize stocks into five groups ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive, externally verified track record , featuring Zacks Rank #1 stocks generating a compound annual return of +25% since 1988. You can see the full list of today’s Zacks Rank #1 (Strong Buy) stocks here >>>>

Another factor confirming the company’s fundamental strength is its average broker rating of #1 (strong buy). This suggests that the brokerage community is very bullish on the stock’s near-term price action.

Therefore, the price trend at CALB may not reverse any time soon.

In addition to CALB, there are several other stocks currently looping through our Current Price Strength screen. You can consider investing in them and look for the latest stocks that meet these criteria.

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

However, remember that the key to a successful stock picking strategy is making sure it has a history of producing profitable results. It’s easy to do with 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.

Click here to sign up for a free trial of Research Wizard today.

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California Bank of Commerce (CALB): Free Stock Research Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.