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The rally is cooling down after brushing up against record highs. On the whole, investor sentiment still remains high; the COVID vaccine roll-out is well underway, earnings have exceeded expectations and it's only a matter of time before a stimulus is passed by the House and Senate. As a full-blown economic reopening continues to hang in the balance, our AI has identified the best stocks and ETFs for investors to buy, as well as stocks and ETFs suitable for short-selling.
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Telecom giant AT&T Inc (T) is rated Top Buy for the next week and has been assigned Q-Factor Scores of C in Technicals, B in Growth, B in Low Volatility Momentum and A in Quality Value. It is accompanied by consumer goods manufacturing companies Kimberly-Clark Corp (KMB) and Procter & Gamble Co (PG). Kimberly-Clark has received Q-Factor Scores of D in Technicals, B in Growth, A in Low Volatility Momentum and B in Quality Value while P&G received scores of D in Technicals, B in Growth, A in Low Volatility Momentum and B in Quality Value.
After a week-long hiatus, Western Digital Corp (WDC) is back on our Top Short list for both the next week and 30 days. It earned Q-Factor Scores of F in Technials, D in Growth, D in Low Volatility Momentum and F in Quality Value. Western Digital’s stock has been affected by the current global shortage of semiconductor chips and remains negative. The other stock rated Top Short for the next 30 days is Mosaic Co (MOS), which has received Q-Factor Scores of D in Technicals, F in Growth, F in Low Volatility Momentum and F in Quality Value.
For Top Buys over the next 30 days, our AI has identified Verizon Communications Inc (VZ) and Intl Business Machines Corp (IBM). Verizon earned scores of F in Technicals, B in Growth, A in Low Volatility Momentum and C in Quality Value while IBM received scores of D in Technicals, B in Growth, B in Low Volatility Momentum and B in Quality Value. The last stock to be rated Top Buy over the next month is cigarette manufacturer and distributor, Altria Group Inc (MO), which scored C in Technicals, A in Growth, B in Low Volatility Momentum and B in Quality Value.
Our AI models maintain its favorability for commodities such as iShares Silver Trust (SLV), which has earned a Top Buy rating for the next week. It also holds the same sentiment for oil and gas, as it has rated Energy Select Sector SPDR Fund (XLE) and Vanguard Energy (VDE) as its two other Top Buys for the next week. On the other hand, it has rated Alpha Architect Value Momentum Trend (VMOT) and Cambria Global Momentum (GMOM) Top Short for the next week.
For the next 30 days, the trend is very different compared to the ETFs rated Top Short for the next week. iShares Russell 2000 (IWM) and Vanguard Small-Cap (VB), both ETFs that gain investors exposure to small-cap companies, are rated Top Short. iShares U.S. Consumer Services (IYC), an ETF that focuses on consumer service equities based in the U.S., is also rated Top Short. The Top Buys are iShares MSCI Brazil (EWZ) and SPDR S&P Retail (XRT). EWZ focuses on medium and large business in Brazil while the XRT concentrates on a variety of companies within the retail sector such as automotive, apparel and internet & direct marketing. XRT is currently up over 20% on the year so far.
Some of our favorite options trades this week:
Short Put Spread in Apple (AAPL): Bullish trade in one of favorite Top Buys this month. Great way to introduce yield into a portfolio.
Short Call Spread in iShares Russell 2000 ETF (IWM): Bearish trade on US Small-Cap Sector. Both a yield and hedge opportunity for stocks portfolios over-exposed to Beta without decreasing actual holdings.
Short Put Spread in SPDR S&P Oil & Gas Exploration & Production ETF (XOP): Bullish idea on one of our top sector ideas. Yield play which still offers upside if stock pulls back in near-term on technicals overbought signal.
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