2 Momentum Stocks To Buy Before June

The S&P 500 has marked its eighth consecutive week of gains. We are currently in the longest positive streak since late 2023.

With that being said, not all the developments we’re seeing are positive. On Tuesday, the yield of 30-year Treasuries closed at the highest level since 2007. Yields did slip by the end of the week, but they remain elevated.

Higher yields raise the bar for equities, especially for companies trading on stretched valuations or distant earnings expectations. In conditions like these, stocks need clearer catalysts to justify the added risk.

Now, the market’s latest run shows that demand for stocks remains strong, but the yield situation does suggest that a more selective approach may be needed. One of the easiest ways to do that is by starting with positive price action.

Stocks that demonstrate clear upward momentum and outpace the wider market stand out, and they’re much more likely to attract investor attention. The issue here is this: how do you hone in on rallies that still haven’t run out of steam, and identify tickers where entering after positive price action has already occurred is supported by the fundamentals?

Well, the easiest place to start is …

Momentum Stock Strategy

Our quant rating system evaluates 4,600 stocks each day through the lens of 115 fundamental metrics split across 7 categories. Those insights are combined into a single, intuitive metric — a stock’s Zen Rating.

Only the stocks that rank in the top 5% on the whole are given a Zen Rating of A. And while that’s a great start, it comes out to approximately 230 stocks to consider on any given date. However, you can narrow the search down even further — by turning to one of our exclusive Zen Strategies.

Each strategy is a meticulously crafted portfolio that consists of just 7 tickers. This time around, you’ll see 2 stocks from our best-performing strategy. This portfolio has an all-time annual return of 42.78%, and it has secured a 23.88% gain since the start of the year. Today, it’s time for our Momentum Stock Strategy.

Enerflex (EFXT)

Our first pick, Enerflex, is a $3.3 billion energy infrastructure business focused on natural gas. EFXT currently ranks in the top 12% of the stocks that we track for overall fundamentals. When it comes to Momentum, it ranks in the top 1% — thanks to a 48% gain on the 3-month chart and a 252% gain on the 1-year chart.

There are 3 areas where Enerflex shines on top of that — Sentiment, Safety, and Financials. A placement in the top 4% for Sentiment tells us that the stock has attracted significant interest from smart money. EFXT is also in the top 11% for Safety, which indicates consistent performance and a high degree of predictability when it comes to earnings. Lastly, it’s also in the top 19% for Financials, indicating a healthy balance sheet.

The downsides are C grades for Value and Growth. Enerflex reads as average in those categories. But there’s cause for optimism on both fronts. The latest earnings report on May 7 was a beat, and delivered 84% EPS growth on a YoY basis. EFXT also trades at around 17 times forward earnings, which is quite reasonable.

While it has been in an extended uptrend, the stock has a unique advantage. Enerflex’s backlog stands at roughly $2.5 billion, and the book-to-bill ratio is 1.5x. In simple terms, they book about $1.50 in new orders for every $1 of revenue they deliver. All in all, a reasonable valuation, plenty of smart money lining up behind it, a healthy financial position, and growing demand.

ASE Technology (ASX)

Our second pick, ASE Technology, is a $29 billion behind-the-scenes semiconductor play. The company tests and packages chips. At present, ASX ranks in the top 10% of the stocks we track. Like our previous pick, it also ranks in the top 1% for Momentum, thanks to a 48% rally in the past 3 months, which has brought returns in the last 365 days up to 252%.

On top of that, just like EFXT, ASX shines when it comes to Sentiment and Safety; top 5% for the former, top 12% for the latter. But smart money positioning and stable execution aren’t the only things ASE Technology has going for it. It also ranks in the top 23% for Growth and the top 28% for Value

ASE Technology does have one notable drawback — the balance sheet. Right now, the stock is in the bottom 36% for Financials. With that being said, there’s cause for optimism; the company has beaten earnings estimates for 3 quarters in a row, notably delivering YoY EPS growth of 78.9% and 56.4% in the last two reports. 

ASX shares have marked a modest gain of 2.96% in the past week. The business is a crucial part of the AI supply chain, and with solid quarterly results from the major AI hyperscalers in the Mag 7, there’s more than enough cause for optimism that the stock will absorb the downstream effects.

Interested In More Great Stock Picks?

The 2 stocks highlighted above are just a fraction of what you get from our proven Momentum Stock strategy. 

That’s because each day our system recalibrates — and Zen Strategies members get access to the top 7 artificial intelligence stocks based on 115 different parameters that point to outperformance. 

See all Top 7 Momentum stocks here >

However, maybe large-cap stocks aren’t what you’re looking to add to your portfolio right now. Perhaps you would like to see all 11 of our market beating strategies including Growth, Value, Technology, or perhaps even Income stocks. 

Each featuring the top 7 stocks.

Each featuring tremendous performance.

We spell it all out in this timely presentation below that lives up to its name:

77 Best Stocks Now! > 

What to Do Next?

• 77 Best Stocks NOW! >
• Options Trading with the Zen Ratings >
• 2 New Stocks to Buy from Steve Reitmeister >

Want to get in touch? Email us at news@wallstreetzen.com.