Are you looking for a better Momentum choice? Why Northern Trust Corporation (NTRS) is a great choice

Momentum investing revolves around the idea of ​​following the recent trend of a two-way stock. In the “long” context, investors will “buy high, but expect to sell even higher”. With this methodology, it is essential to take advantage of trends in a stock’s price; once a stock establishes a course, it is more than likely to continue moving in that direction. The goal is that once a security enters a fixed path, it will lead to timely and profitable trades.

While many investors like to look for momentum in stocks, it can be very difficult to define. There is a lot of debate around which metrics to focus on and which are poor quality indicators of future performance. The Zacks Momentum Style Score, which is part of the Zacks Style Scores, helps solve this problem for us.

Below we examine Northern Trust Company (NTRS)which currently has a Momentum Style Score of A. We also discuss some of the key drivers of the Momentum Style Score, such as price movement and earnings estimate revisions.

It’s also important to note that Style Scores work alongside Zacks Rank, our stock rating system which has an impressive track record of outperformance. Northern Trust Corporation currently has a Zacks rank of #2 (buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the next month.

You can see the current list of Zacks #1 Ranking Stocks here >>>

Ready to beat the market?

In order to see if NTRS is a promising dynamic choice, let’s look at some elements of the Momentum style to see if this company holds up.

Looking at a stock’s short-term price activity is a great way to gauge whether it has momentum, as it can reflect both current interest in a stock and whether buyers or sellers have the upper hand right now. It is also useful to compare a stock to its industry, as this can help investors identify the best companies in a particular area.

For NTRS, shares rose 3.05% over the past week, while industry Zacks Banks – Major Regional rose 2.5% over the same period. Stocks also look pretty good over a longer timeframe, as the monthly price change of 12.27% also compares favorably to the industry’s performance of 11.37%.

Considering longer-term price metrics, like performance over the past three months or year, can also be beneficial. Over the past quarter, shares of Northern Trust Corporation have risen 7.33% and 35.83% over the past year. In contrast, the S&P 500 only moved 2.45% and 23.1%, respectively.

Investors should also pay attention to the 20-day average trading volume of NTRS. Volume is a useful element in many ways, and the 20-day average sets a good price-volume benchmark; a rising stock with above average volume is usually a bullish sign, while a falling stock on above average volume is usually bearish. NTRS is currently showing an average of 635,098 shares over the past 20 days.

Earnings outlook

The Zacks Momentum Style Score also takes into account trends in rating revisions, in addition to price changes. Please note that estimate revision trends also remain at the heart of the Zacks Ranking. A good path here can help show promise, and we saw that recently with NTRS.

Over the past two months, 3 earnings estimates have risen versus no declines for the full year. These revisions helped raise the consensus estimate of NTRS from $7.01 to $7.03 over the past 60 days. Regarding the next fiscal year, 5 estimates have increased while there has been 1 downward revision during the same period.

Conclusion

Considering all of this, it’s no surprise that NTRS is a #2 (buy) stock with a Momentum score of A. Northern Trust Corporation on your shortlist.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.