The stock market has witnessed a freefall amid reckless inflation, the Fed’s rate hikes, and rising recession fears. According to Morgan Stanley Wealth Management’s investment chief, the S&P 500 will plunge another 10% in 2022. Moreover, AAII’s latest survey revealed that bearish sentiment had reached its historical average of 30.5%.
The broad market sell-off led several stocks to get hammered, despite their sound fundamentals. Amid the volatile backdrop, investors should focus on a long-term strategy. Experts believe investors should continue to put money into the stock market.
“Consistency in life and in investing is a real critical element to building wealth,” said certified financial planner Diahann Lassus, managing principal at Peapack Private Wealth Management in New Providence, New Jersey.
So, we think beaten-down stocks AstroNova, Inc. (ALOT), AdvanSix Inc. (ASIX), JBS S.A. (JBSAY), and ArcelorMittal S.A. (MT) could be solid additions to your portfolio now, given their fundamental strength. These stocks are rated Strong Buy in our POWR Ratings system.
AstroNova, Inc. (ALOT)
ALOT designs, develops, manufactures, and distributes specialty printers and data acquisition and analysis systems in the United States, Europe, Asia, Canada, Central and South America, and internationally. The company has two segments- Product Identification and Test & Measurement.
On June 8, 2022, Gregory A. Woods, President, and CEO, said, “The underlying fundamentals of our business remain strong, and we are especially encouraged by the momentum we are seeing in Test & Measurement as the commercial aviation market continues its recovery.”
ALOT’s revenue increased 6.6% year-over-year to $31.01 million for the first quarter ended April 30, 2022. Its United States revenue came in at $19.65 million, up 17.7% year-over-year. Also, its hardware revenue came in at $9.30 million, up 21.6% year-over-year.
ALOT’s revenue is expected to increase 6.4% year-over-year to $125.03 million in 2023. The stock has lost 11.9% year-to-date to close the last trading session at $11.90.
ALOT’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall A rating, which indicates a Strong Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
ALOT has an A grade for Value and Sentiment and a B for Momentum and Quality. Within the B-rated Technology - Hardware industry, it is ranked first among 49 stocks. Click here for the additional POWR Ratings for Growth and Stability for ALOT.
AdvanSix Inc. (ASIX)
ASIX manufactures and sells polymer resins in the United States and internationally. It offers Nylon 6, a polymer resin; caprolactam- to manufacture polymer resins; ammonium sulfate fertilizers; acetone; and other intermediate chemicals.
On May 6, 2022, Erin Kane, ASIX’s President and CEO, said, “This is an exciting time at AdvanSix, and we are well-positioned to deliver long-term shareholder returns as we drive superior operational excellence and differentiated product growth, progress our sustainability initiatives and maintain strong and disciplined capital stewardship.”
ASIX’s sales came in at $479.07 million for the first quarter ended March 31, 2022, up 27.3% year-over-year. Its net income came in at $63.07 million, up 124.2% year-over-year, while its EPS came in at $2.15, up 119.4% year-over-year.
Analysts expect ASIX’s revenue to increase 22.9% year-over-year to $2.07 billion in 2022. Its EPS is expected to grow 64% year-over-year to $7.89 in 2022. Also, it surpassed EPS estimates in three of the four trailing quarters. The stock has lost 29.3% year-to-date to close the last trading session at $33.39.
It’s no surprise that ASIX has an overall A rating, representing a Strong Buy. It has an A grade for Value and a B grade for Growth. It is ranked #10 out of 91 stocks in the A-rated Chemicals industry.
Click here to see the additional ratings for ASIX (Momentum, Stability, Sentiment, and Quality).
JBS S.A. (JBSAY)
Headquartered in São Paulo, Brazil, food company JBSAY processes and trades in animal protein worldwide. It offers beef, pork, chicken, and lamb products and by-products; food products; pet food and concentrates; and bresaola.
For the first quarter ended March 31, 2022, JBSAY’s net revenue came in at R$90.87 billion ($17.53 billion), up 20.8% year-over-year. Its gross profit came in at R$16.37 billion ($3.16 billion), up 47.3% year-over-year.
Moreover, its adjusted EBITDA increased 46.6% year-over-year to R$10.08 billion ($1.95 billion), while its EPS came in at R$2.29, up 182.7% year-over-year.
JBSAY’s revenue is expected to increase marginally year-over-year to $71.63 billion in December 2023. The stock has lost 9.2% year-to-date to close the last trading session at $12.34.
JBSAY has an overall A rating, equating to a Strong Buy in our proprietary rating system. In addition, it has an A grade for Value and a B grade for Growth, Stability, and Sentiment.
JBSAY is ranked #3 out of 88 stocks in the B-Rated Food Makers industry. Click here to see the additional POWR Ratings for JBSAY (Momentum and Quality).
ArcelorMittal S.A. (MT)
Headquartered in Luxembourg City, Luxembourg, MT, and its subsidiaries operate as integrated steel and mining companies in Europe, North and South America, Asia, and Africa. Its main steel products include semi-finished flat products, semi-finished long products, and seamless and welded pipes and tubes.
On June 14, 2022, MT published its concept for a low-carbon emissions steel standard, targeting the decarbonization of steelmaking globally. This strategy aims to optimize steel production with maximum sustainability.
MT’s sales increased 34.8% year-over-year to $21.84 billion for the first quarter ended March 31, 2022. Its net income came in at $4.13 billion, up 80.5% year-over-year, while its EPS came in at $4.27, up 121.2% year-over-year.
MT’s revenue is expected to increase 6.6% year-over-year to $81.63 billion in 2022. It surpassed EPS estimates in three of the four trailing quarters. The stock has lost 26.1% year-to-date to close the last trading session at $23.51.
MT's overall A rating equates to a Strong Buy in our POWR Ratings system. It has an A grade for Value and a B grade for Momentum and Quality.
Click here for the additional ratings for MT (Growth, Stability, and Sentiment). MT is ranked #7 out of 32 stocks in the A-rated Steel industry.
ALOT shares were trading at $11.79 per share on Thursday afternoon, down $0.11 (-0.92%). Year-to-date, ALOT has declined -12.67%, versus a -19.76% rise in the benchmark S&P 500 index during the same period.
About the Author: Riddhima Chakraborty
Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master's degree in economics, she helps investors make informed investment decisions through her insightful commentaries.
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