I’ve never recommended buying shares of GameStop Corp. (NYSE: GME).
But the day before that stock peaked back in January, Green Zone Fortunes co-editor Charles Sizemore and I helped our readers lock in a profit of more than 100% … on a different “momentum” stock.
We sent that “sell” alert to our subscribers on January 27.
We recommended they buy the stock a mere month earlier … in the December issue of our flagship newsletter, Green Zone Fortunes.
Our detailed, 6-page write-up on that company outlined the rationale for buying shares.
That’s our style. We gave our readers everything they needed to make a profitable trade.
It had nothing to do with r/WallStreetBets or the cult of Robinhood traders who’ve made runs on “momentum stocks.”
Frankly, that’s not our game.
Charles and I, and our research analyst, Matt Clark … we follow a far more disciplined approach. We leverage price momentum to identify market-beating stocks for our readers. But we do it “scientifically,” if you will. We don’t look solely at momentum.
And we sure as hell don’t recommend buying stocks just because there’s buzz building on an internet message board.
Instead, we focus on “well-rounded” stock recommendations.
Introducing: The Green Zone Ratings Model for Stocks
Let me ask you this…
Would you buy a “momentum” stock if you had to overpay for it? Say its price-to-earnings ratio was higher than 90% of stocks in the market?
What about a so-called “value” stock — would you buy a value stock for, say, 70 cents on the dollar … if you knew that company had 10 times more debt on its books than cash? And that it was losing money quarter after quarter?
Looking at growth … what if a small company was getting smaller, because its revenues and earnings were shrinking year after year?
Would you want to invest in that company?
Of course you wouldn’t!
You’d want to look for the opposite — to identify solid companies with strong fundamentals, which are also trading at fair valuations … and which still have growing revenues and earnings. If their stock price is also showing market-leading momentum — indicating it’s in high demand — then all the better!
In short, you can make the most money in “well-rounded” stocks — those with a favorable balance of the factors that prove to drive stock returns.
And that’s exactly what my Green Zone Ratings model does.
If you frequent Money & Markets, you might be familiar with the system. But I’ll give a quick rundown.
It rates each of the 8,000 or so stocks in the market on six factors. Three are price-based: momentum, size and volatility.
Three are based on the company’s fundamentals: value, quality and growth.
Ultimately, my model assigns a score of 0 to 100 to each stock. And our research so far proves that top-rated stocks can beat the broader market by at least 3-to-1.
How We Find Top Momentum Stocks — Without Reddit
Take, for instance, the stock Charles and I recommended in our December 2020 issue of Green Zone Fortunes.
My model rated that stock 97 out of 100 when we recommended it to our readers. It was a well-rounded stock, with top scores in quality (99), momentum (97), volatility (91) and growth (88).
Plus, Charles and I identified a hidden momentum factor that promised to send this particular stock ripping higher. We wrote: “If [this factor comes to fruition], we could see the stock pop to $110 or $120 in a hurry.”
Well, it happened in late January. Only our target estimates of $110 to $120 per share proved too conservative. The stock surged all the way to $169 … where we told our readers to lock in their profits of more than 100%!
But here’s the thing — we aren’t done with this stock. We told folks to sell just half of their position. Because, ultimately, we believe the stock will go on to make us even larger profits over the next six to 36 months.
Again, this is a rock-solid, well-rounded stock. It rates highly on all six of my model’s factors … and still scores a 93 out of 100 overall two months after our initial recommendation.
It’s just the type of stock that Charles and I are loading the Green Zone Fortunes portfolio with. And it’s one of many double- and triple-digit profit opportunities we’ve identified in the past year.
We aren’t done, either.
Next week, Charles and I are doing something we haven’t done yet for our Green Zone Fortunes subscribers.
In the March issue, we’ll reveal our two highest-conviction stock recommendations for the month in an industry that is building more momentum every day. We got a taste of this move up during the recent tech sell-off, and we’re convinced that’s only the beginning.
This industry is trading at dirt-cheap valuations, and events outside of the markets (such as President Biden’s initiatives) will fuel the momentum on these two stocks even higher.
If you want to get in on the ground floor of this trade — and many others like it in the future — click here to find out how you can access Green Zone Fortunes today.
Along with our best monthly picks, you’ll also learn how you can use momentum to “buy high … sell higher.” Check out the details of my Millionaire Master Class here.
To good profits,
Chief Investment Strategist
Adam O’Dell is the chief investment strategist of Money & Markets and has held the title of Chartered Market Technician for nearly a decade. He is the editor of Green Zone Fortunes, the trend and momentum options-trading powerhouse Home Run Profits and the time-tested switch system 10X Profits.