Is Lenovo Group Ltd. (LNVGY) a Solid Growth Stock? 3 Reasons to Think " Yes "

Investors seek growth stocks to capitalize on above-average growth in financials that help these securities grab the market’s attention and produce exceptional returns. But finding a growth stock that can live up to its true potential can be a tough task.

Zacks Style Scores, Click to get this free report

– Zacks

In addition to volatility, these stocks carry above-average risk by their very nature. Also, one could end up losing from a stock whose growth story is actually over or nearing its end.

However, the Zacks Growth Style Score (part of the Zacks Style Scores system), which looks beyond the traditional growth attributes to analyze a company’s real growth prospects, makes it pretty easy to find cutting-edge growth stocks.

Lenovo Group Ltd. (LNVGY) is one such stock that our proprietary system currently recommends. The company not only has a favorable Growth Score, but also carries a top Zacks Rank.

Studies have shown that stocks with the best growth features consistently outperform the market. And for stocks that have a combination of a Growth Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy), returns are even better.

Here are three of the most important factors that make the stock of this company a great growth pick right now.

Earnings Growth

Earnings growth is arguably the most important factor, as stocks exhibiting exceptionally surging profit levels tend to attract the attention of most investors. For growth investors, double-digit earnings growth is highly preferable, as it is often perceived as an indication of strong prospects (and stock price gains) for the company under consideration.

While the historical EPS growth rate for Lenovo Group Ltd. is 32.1%, investors should actually focus on the projected growth. The company’s EPS is expected to grow 81.7% this year, crushing the industry average, which calls for EPS growth of 45.7%.

Cash Flow Growth

While cash is the lifeblood of any business, higher-than-average cash flow growth is more important and beneficial for growth-oriented companies than for mature companies. That’s because, growth in cash flow enables these companies to expand their businesses without depending on expensive outside funds.

Right now, year-over-year cash flow growth for Lenovo Group Ltd. is 36.9%, which is higher than many of its peers. In fact, the rate compares to the industry average of 35.6%.

While investors should actually consider the current cash flow growth, it’s worth taking a look at the historical rate too for putting the current reading into proper perspective. The company’s annualized cash flow growth rate has been 29.6% over the past 3-5 years versus the industry average of 13.5%.

Promising Earnings Estimate Revisions

Superiority of a stock in terms of the metrics outlined above can be further validated by looking at the trend in earnings estimate revisions. A positive trend is of course favorable here. Empirical research shows that there is a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

There have been upward revisions in current-year earnings estimates for Lenovo Group Ltd. The Zacks Consensus Estimate for the current year has surged 6.2% over the past month.

Bottom Line

Lenovo Group Ltd. has not only earned a Growth Score of A based on a number of factors, including the ones discussed above, but it also carries a Zacks Rank #2 because of the positive earnings estimate revisions.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

This combination positions Lenovo Group Ltd. well for outperformance, so growth investors may want to bet on it.


Zacks’ Top Picks to Cash in on Artificial Intelligence

In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create “the world’s first trillionaires.” Zacks’ urgent special report reveals 3 AI picks investors need to know about today.

See 3 Artificial Intelligence Stocks With Extreme Upside Potential>>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

 

Lenovo Group Ltd. (LNVGY): Free Stock Analysis Report

 

To read this article on Zacks.com click here.

News Related

OTHER NEWS

Intel Is the Perfect Stock To Buy When the Chips are Down

Time to use fear to your advantage with a covered call trade on POWR Buy rated value stock INTC. shutterstock.com – StockNews To say the market has started the year ... Read more »

These Are the Ten Best Performing Options Trading Funds

Mutual Funds typically invest in stocks and fixed-income securities. However, there are funds that, along with investing in such securities, may also invest in derivatives contracts such as options and ... Read more »

3 Things to Know About the Q4 Earnings Season

We get into the heart of the Q4 earnings season this week, with results from more than 300 companies coming out, including a total of 108 S&P 500 members. – ... Read more »

Finsall Raises INR 12 Crore In Pre Series A

Insurance-focused fintech platform Finsall has raised INR 12 crore in a pre Series A round from its existing investors – Unicorn India Ventures and SEA Fund – along with a ... Read more »

Telecommunications Sector: 3 Must-See Stocks for 2022

Telecommunications has made great strides since just five years ago (consider the leaps it has made since 10 years ago!) Due to changing consumer habits and preferences, speed, accessibility and ... Read more »

With reAlpha's Approach to Real Estate, Anyone Can Own Short-Term Rental Properties

Did you know that the short-term rental market has now soared past a $1.2 trillion valuation? This stat comes directly from Airbnb’s recent IPO filing, which we should remind you ... Read more »

3 Great Healthcare Stocks to Buy Now

Healthcare Stocks Are Appealing in Any Market Environment It’s fair to say that the healthcare sector is one of the most intriguing areas of the market for investors to explore. ... Read more »

A.O. Smith (AOS) Stock Moves -1.78%: What You Should Know

A.O. Smith (AOS) closed the most recent trading day at $76.82, moving -1.78% from the previous trading session. This move was narrower than the S&P 500’s daily loss of 1.89%. ... Read more »

3 Cold-Calling Secrets From Sara Blakely, Founder of Spanx

There’s a reason why Spanx founder Sara Blakely can teach us so much about cold calling, and it has nothing to do with how great she is at creating inventions. ... Read more »

Why Hard Work Alone Isn't Enough

Ask most successful people how they managed to achieve and they’ll tell you that it’s simple: hard work. Some will be a bit more honest and tell you it also ... Read more »

China Lets In Most of the Australian Coal Stranded at Its Ports

(Bloomberg) — Most of the Australian coal used by steelmakers that was being held at Chinese ports in the wake of Beijing’s import ban has now been cleared, according to ... Read more »

A Music And Dance NFT Project With Real Life Use Cases

The Utopia Club NFT is quickly gathering a lot of hype within the NFT world. And today, we are going to take a look at its use cases in the ... Read more »

JM Financial Asset Reconstruction Company allowed to substitute Bank of India as petitioner

A dedicated bankruptcy court has allowed JM Financial Asset Reconstruction Company (ARC) to substitute the original petitioner Bank of India in a plea seeking admission of National Steel & Agro ... Read more »

City of London's $10 Trillion Chinese Conduit Plans for Growth

(Bloomberg) — The U.K.’s relations with China may be at a low ebb but China Construction Bank Corp.’s City of London outpost is banking on ever closer financial flows between ... Read more »

iPhone Assembler Hon Hai Expects ‘Unprecedented' First Quarter

(Bloomberg) — Key iPhone assembler Hon Hai Precision Industry Co. may achieve an “unprecedented” performance in the first quarter, according to Chairman Young Liu. Most Read from Bloomberg Shares in ... Read more »

SoftBank to Expand Vision Fund Staff for More Japan Investment

1 / 2SoftBank to Expand Vision Fund Staff for More Japan Investment (Bloomberg) — SoftBank Group Corp. plans to expand the Japan investment team for its Vision Fund, adding staff ... Read more »

Agile to Exit Joint Venture for $290 Million: Evergrande Update

(Bloomberg) — Agile Group, the junk-rated Chinese property developer, will sell its 26.7% stake in a Guangzhou property joint venture for 1.84 billion yuan ($290 million), the latest sign that ... Read more »

Temasek Set to Buy Bridgepoint's Testing Business for $7 Billion

(Bloomberg) — Singapore state-owned investor Temasek Holdings Pte is nearing a deal to buy testing company Element Materials Technology from buyout firm Bridgepoint Group Plc for almost $7 billion, according ... Read more »

Australia's Private Sector Activity Shrinks in January: Survey

1 / 2Australia’s Private Sector Activity Shrinks in January: Survey (Bloomberg) — Australia’s private sector shrank for the first time in four months and business confidence dived in response to ... Read more »

Hedge Fund Winners and Losers Turn Extreme in Wild Asian Markets

1 / 2Hedge Fund Winners and Losers Turn Extreme in Wild Asian Markets (Bloomberg) — One of the wildest runs for Asian markets in recent memory helped drive the gap ... Read more »

Europe's Economies Have More at Stake Than U.S. in Russia Clash

1 / 5Europe’s Economies Have More at Stake Than U.S. in Russia Clash (Bloomberg) — The European Union has a lot more to lose than the U.S. from conflict with ... Read more »

Ramphosa Sees Just Transition as the Way to Energy Security

1 / 3Ramphosa Sees Just Transition as the Way to Energy Security (Bloomberg) — South Africa must embark on a “just energy transition” to stimulate greater investment as a way ... Read more »

Stock futures are flat following S&P 500's worst week since March 2020

Trader on the floor of the NYSE, Jan. 21, 2022.CNBC Stock futures are little changed in overnight trading Sunday, following the S&P 500's worst week since March 2020, as investors ... Read more »

Fortescue to Buy Battery Tech Firm to Decarbonize Mine Trucks

(Bloomberg) — Fortescue Metals Group Ltd. has agreed to buy Williams Advanced Engineering Ltd., which was founded by the Williams Formula 1 racing team, for $223 million to gain access ... Read more »

Sycamore Expresses Interest in Kohl's After Starboard-Backed Bid

(Bloomberg) — Department store retailer Kohl’s Corp. is fielding interest from two suitors at the same time that it’s grappling with multiple activist investors pressuring it to sell. Most Read ... Read more »

China Rate Cuts Not Enough to Stabilize Economy: Ex-PBOC Adviser

1 / 2China Rate Cuts Not Enough to Stabilize Economy: Ex-PBOC Adviser (Bloomberg) — Looser monetary policy in China won’t be sufficient to stabilize the economy and a faster increase ... Read more »

Bond Meltdown Haunts Australian Central Bank as Inflation Builds

1 / 5Bond Meltdown Haunts Australian Central Bank as Inflation Builds (Bloomberg) — Australian bond yields are primed to set new highs as bets that the central bank will scrap ... Read more »

Stocks May Extend Drop on Fed Concerns: Markets Wrap

1 / 2Stocks May Extend Drop on Fed Concerns: Markets Wrap (Bloomberg) — Stocks looked set for further declines Monday amid concerns about tightening Federal Reserve monetary policy, while a ... Read more »

5 Essential Considerations You Need to Make Before Investing in New Technology

If you’re ready to introduce or upgrade some technology tools, you are on the way to seeing great benefits. But shopping for the technologies you need can be tedious. Today, ... Read more »

Interested In IT? Get Up to Speed on CompTIA.

If you want to work in the IT industry these days, you need to get certified and CompTIA is one of the world’s leading certifying bodies. Even if you’d just ... Read more »

Inflation surge could push the Fed into more than four rate hikes this year, Goldman Sachs says

U.S. Federal Reserve Board Chairman Jerome Powell attends his re-nominations hearing of the Senate Banking, Housing and Urban Affairs Committee on Capitol Hill, in Washington, U.S., January 11, 2022.Graeme Jennings ... Read more »

How to Use the Right Data to Make Effective Business Decisions

The days of entrepreneurs and business leaders being forced to make key decisions off little more than gut instinct are long-gone. This isn’t to say that you won’t be forced ... Read more »

25 Ways You Can Turn a One-Time Buyer Into a Repeat Buyer

If you are a business owner, you want customers to keep coming back. Customers who make repeat purchases lower the costs that your company incurs for marketing and advertising. With ... Read more »

The Dos and Don'ts of Dealing With Consumers in the Digital Space

As consumers today, we know what we want and we are willing to pay for this control. In the past decade, digital transformation has greatly accelerated the pace and scope ... Read more »

Find Ways to Compete When Margins Are Razor-Thin

Figuring out how to operate profitably in a market against more profitable competitors offering similar products or services is no easy task. Charge too much and you risk losing potential ... Read more »

The Strategies I Used to Sell Two Business by the Time I was 45

Growing up, I watched my dad run his own business and I had a front-row seat to the freedom and opportunity that gave him. But before jumping feet-first into the ... Read more »

6 Things You Can Do Today That Will Have a Huge Impact on Your Business

There are so many things in business that you cannot control. You have no say on when a global pandemic will shut down the economy. You don’t get to set ... Read more »

Putin will never have another chance like this to overthrow the European strategic order

Vladimir Putin Ukraine Russia European Union Markets seem not to believe that Europe is close to the largest military conflict since 1945, even though the US president tells us that ... Read more »

10 Deals on Apple Products and Accessories

Apple is well-known for being a pioneer in tech. And while Apple makes many useful products for entrepreneurs, they aren’t exactly for the frugal-minded. However, if you’re willing to buy ... Read more »

This Female-Founded Company Has Improved Stock Photography

In a crowded marketplace, it can be difficult to make your business stand out. That’s where great design comes in. Well-designed marketing campaigns, product pages, and other materials can help ... Read more »
On free-english-test.com you will find lots of free English exam practice materials to help you improve your English skills: grammar, listening, reading, writing, ielts, toeic