The U.S. markets are looking to post another week of gains after strong economic data this morning. Housing data revealed that the sale of previously owned homes surged beyond expectations amidst low mortgage rates. Business activity is also picking up in the services and manufacturing sector as revealed in the U.S. Composite PMI Index by HIS Markit. Meanwhile, technology shares continued on its bull run with Financials and Industrials sectors also doing well. Whether valuations are elevated or not might depend on how you view them amidst rock bottom interest rates. Q.ai uses deep learning algorithms paired with Artificial Intelligence (“AI”) technology to identify several Top Buys today.
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Cardinal Health Inc (CAH)
The first company on our list of Top Buys is Cardinal Health Inc
International Business Machines Corp (IBM)
International Business Machines Corp is next on the list, operates as an integrated solutions and services company worldwide. Our deep learning algorithms have given factor scores of B in Technical, C in Growth, B in Momentum Volatility, and B in Quality Value. The stock is down 9.06% for the year, a deviation from the performance of other major players in the technology sector. As for the financials, revenue dropped to $77147.0M in the last fiscal year when compared $79139.0M three years ago. Operating Income was $10785.0M in the last fiscal year, lower than $11682.0M three years ago. EPS, however, grew by 43.61% in three fiscal years to $10.57 in the last fiscal year compared to $6.14 three years ago. Finally, ROE improved significantly to 49.77% in the last year, higher compared to 31.89% three years ago. Revenue growth is expected to be flat in the next 12 months with a rate of 0.65% and the stock is trading at a forward 12M P/E of 10.56. IBM is certainly one of those rare stocks in the technology sectors that has a reasonable valuation.
Msg Networks Inc (MSGN)
Msg Networks Inc engages in the sports production, and content development and distribution businesses in the United States. The company owns and operates MSG Network and MSG+, which are regional sports and entertainment networks. Our AI has assigned factor scores of A in Technical, C in Growth, B in Momentum Volatility, and A in Quality Value to the stock that has lost 41.68% for the year and is expected to do better. As for the financials, revenue was $685.8M in the last fiscal year, slightly lower than $696.65M three years ago. Operating Income also dropped slightly to $293.94M in the last fiscal year from $311.45M three years ago. EPS fell to $2.92 in the last fiscal year from $3.81 three years ago. It is one of another stock with an attractive valuation and trades with a forward 12M P/E of 3.85, suggesting that the valuation is cheap.
Sempra Energy (SRE)
Unifirst Corp (UNF)
Our final Top Buy today is Unifirst Corp
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