Earlier this week, Ed took an in-depth look at momentum investing as part of his Strategy Map series.
To follow up on this, I thought it would be interesting to revisit the 52-week high screen I wrote about back in May. This screen is continuing to flag up some highly-ranked shares. In this piece I’m going to take a look at five companies that appear in the results and look interesting to me right now.
Screen update
After reading Ed’s piece and looking at my screen, I decided to make a few changes. My aim was to tighten up the screen’s focus on momentum focus and make it a little more selective, reducing the number of results to a more manageable level.
However, the fundamental strategy is still the same – I’m looking for profitable businesses with positive momentum that are trading close to 52-week highs.
Here’s a link to my 52-week highs screen – you can see which stocks qualify for the screen and review and copy the rules for your own use, if that’s useful.
This is a snapshot of the updated screen rules:
One concern I had when I created this screen originally was that it would only highlight shares that already looked expensive. As an investor with a strong bias to quality and value, I thought I might struggle with this.
However, that’s not the way it turned out. Many of the shares appearing in the results of this screen look quite reasonably priced to me.
Let’s take a closer look at some of them.
Marks and Spencer (LON:MKS)
I covered this retail stalwart in a detailed Stock Pitch in March. The shares have risen since then but I remain bullish about this long-running turnaround.
The recent full-year results did not reveal any fresh horrors and showed pre-tax profit up by 21% to £475.7m. Store sales were up by 14.9%, with online up 4.8%, with growth seen in Clothing & Home (+11.5%) in addition to the food business.
Although the Ocado JV is not performing quite as well as might have been hoped, my guess is that this may allow M&S to acquire the remaining part of…
