Best Value Stocks to Buy for November 14th

Shares of Allient (ALNT) have gained 24.4% over the past four weeks to close the last trading session at $23.28, but there could still be a solid upside left in the stock if short-term price targets of Wall Street analysts are any indication. Going by the price targets, the mean estimate of $29.33 indicates a potential upside of 26%.

The mean estimate comprises three short-term price targets with a standard deviation of $1.15. While the lowest estimate of $28 indicates a 20.3% increase from the current price level, the most optimistic analyst expects the stock to surge 28.9% to reach $30. It's very important to note the standard deviation here, as it helps understand the variability of the estimates. The smaller the standard deviation, the greater the agreement among analysts.

While the consensus price target is a much-coveted metric for investors, solely banking on this metric to make an investment decision may not be wise at all. That's because the ability and unbiasedness of analysts in setting price targets have long been questionable.

But, for ALNT, an impressive average price target is not the only indicator of a potential upside. Strong agreement among analysts about the company's ability to report better earnings than they predicted earlier strengthens this view. While a positive trend in earnings estimate revisions doesn't gauge how much a stock could gain, it has proven to be powerful in predicting an upside.

Here's What You Should Know About Analysts' Price Targets

According to researchers at several universities across the globe, a price target is one of many pieces of information about a stock that misleads investors far more often than it guides. In fact, empirical research shows that price targets set by several analysts, irrespective of the extent of agreement, rarely indicate where the price of a stock could actually be heading.

While Wall Street analysts have deep knowledge of a company's fundamentals and the sensitivity of its business to economic and industry issues, many of them tend to set overly optimistic price targets. Are you wondering why?

They usually do that to drum up interest in shares of companies that their firms either have existing business relationships with or are looking to be associated with. In other words, business incentives of firms covering a stock often result in inflated price targets set by analysts.

However, a tight clustering of price targets, which is represented by a low standard deviation, indicates that analysts have a high degree of agreement about the direction and magnitude of a stock's price movement. While that doesn't necessarily mean the stock will hit the average price target, it could be a good starting point for further research aimed at identifying the potential fundamental driving forces.

That said, while investors should not entirely ignore price targets, making an investment decision solely based on them could lead to disappointing ROI. So, price targets should always be treated with a high degree of skepticism.

Here's Why There Could be Plenty of Upside Left in ALNT

Analysts' growing optimism over the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher, could be a legitimate reason to expect an upside in the stock. That's because empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

Over the last 30 days, the Zacks Consensus Estimate for the current year has increased 8.6%, as one estimate has moved higher compared to no negative revision.

Moreover, ALNT currently has a Zacks Rank #1 (Strong Buy), which means it is in the top 5% of more than the 4,000 stocks that we rank based on four factors related to earnings estimates. Given an impressive externally-audited track record, this is a more conclusive indication of the stock's potential upside in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here

Therefore, while the consensus price target may not be a reliable indicator of how much ALNT could gain, the direction of price movement it implies does appear to be a good guide.

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Momentum investing is essentially the opposite of the tried-and-tested Wall Street adage -- "buy low and sell high." Investors following this investing style typically avoid betting on cheap stocks and waiting long for them to recover. They believe instead that one could make far more money in lesser time by "buying high and selling higher."

Who doesn't like betting on fast-moving trending stocks? But determining the right entry point isn't easy. Often, these stocks lose momentum once their valuation moves ahead of their future growth potential. In such a situation, investors find themselves loaded up on expensive shares with limited to no upside or even a downside. So, going all-in on momentum could be risky at times.

A safer approach could be investing in bargain stocks with recent price momentum. While the Zacks Momentum Style Score (part of the Zacks Style Scores system) helps identify great momentum stocks by paying close attention to trends in a stock's price or earnings, our 'Fast-Paced Momentum at a Bargain' screen comes handy in spotting fast-moving stocks that are still attractively priced.

Allient (ALNT) is one of the several great candidates that made it through the screen. While there are numerous reasons why this stock is a great choice, here are the most vital ones:

Investors' growing interest in a stock is reflected in its recent price increase. A price change of 24.4% over the past four weeks positions the stock of this motion control product maker well in this regard.

While any stock can see a spike in price for a short period, it takes a real momentum player to deliver positive returns for a longer time frame. ALNT meets this criterion too, as the stock gained 12.7% over the past 12 weeks.

Moreover, the momentum for ALNT is fast paced, as the stock currently has a beta of 1.51. This indicates that the stock moves 51% higher than the market in either direction.

Given this price performance, it is no surprise that ALNT has a Momentum Score of B, which indicates that this is the right time to enter the stock to take advantage of the momentum with the highest probability of success.

In addition to a favorable Momentum Score, an upward trend in earnings estimate revisions has helped ALNT earn a Zacks Rank #1 (Strong Buy). Our research shows that the momentum-effect is quite strong among Zacks Rank #1 and #2 stocks. That's because as covering analysts raise their earnings estimates for a stock, more and more investors take an interest in it, helping its price race to keep up. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here

Most importantly, despite possessing fast-paced momentum features, ALNT is trading at a reasonable valuation. In terms of Price-to-Sales ratio, which is considered as one of the best valuation metrics, the stock looks quite cheap now. ALNT is currently trading at 0.71 times its sales. In other words, investors need to pay only 71 cents for each dollar of sales.

So, ALNT appears to have plenty of room to run, and that too at a fast pace.

In addition to ALNT, there are several other stocks that currently pass through our 'Fast-Paced Momentum at a Bargain' screen. You may consider investing in them and start looking for the newest stocks that fit these criteria.

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

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Allient (ALNT) came out with quarterly earnings of $0.31 per share, beating the Zacks Consensus Estimate of $0.21 per share. This compares to earnings of $0.61 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of 47.62%. A quarter ago, it was expected that this motion control product maker would post earnings of $0.40 per share when it actually produced earnings of $0.29, delivering a surprise of -27.50%.

Over the last four quarters, the company has surpassed consensus EPS estimates three times.

Allient, which belongs to the Zacks Electronics - Miscellaneous Components industry, posted revenues of $125.21 million for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 0.75%. This compares to year-ago revenues of $145.32 million. The company has topped consensus revenue estimates three times over the last four quarters.

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.

Allient shares have lost about 37.8% since the beginning of the year versus the S&P 500's gain of 21.2%.

What's Next for Allient?

While Allient has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for Allient: mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead. The current consensus EPS estimate is $0.21 on $118.95 million in revenues for the coming quarter and $1.29 on $526 million in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Electronics - Miscellaneous Components is currently in the top 31% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

One other stock from the same industry, LightPath Technologies, Inc. (LPTH), is yet to report results for the quarter ended September 2024. The results are expected to be released on November 7.

This company is expected to post quarterly loss of $0.05 per share in its upcoming report, which represents a year-over-year change of -25%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days.

LightPath Technologies, Inc.'s revenues are expected to be $8.55 million, up 5.8% from the year-ago quarter.

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