The Dow was lower this morning, on the day that they make major changes to their constituents with Salesforce, Amgen, and Honeywell to the index replacing Exxon Mobi, Pfizer, and Raytheon Technologies. The big changes came as Apple announced its share split, which reduced the technology influence and exposure in the long-time index from 12% to 3%, as it is price weighted. The changes look to take advantage of more "new economy" stocks – it would have done them well to add Salesforce earlier as it had a massive bump last week after earnings. The big economic report will be released on Friday this week, with the Labor Department set to announce the latest U.S. jobs report, where it is estimated 1.255 million jobs were created in August. The deep learning algorithms by Q.ai have used Artificial Intelligence (“AI”) technology to identify several Top Buys today.
Fortune Brands Home & Security (FBHS)
First on the Top Buy list today is Fortune Brands Home & Security, with AI-based factor scores of C in Technical, B in Growth, B in Momentum Volatility, and B in Quality Value. The company is a leading home and security products company that operates four segments, and the stock is up 29.78% for the year already. Our deep learning algorithms thinks the upward momentum will continue from here. As for the financials, revenue grew by 8.04% over the last three fiscal years to $5764.6M in the last fiscal, which compares to $5283.3M three years ago. Operating Income grew by 2.93% in the last fiscal year to $740.6M, a growth of 5.68% over the last three fiscal years from $721.3M three years ago. EPS grew by 1.28% in the last fiscal year to $3.06, a growth of 2.18% over the last three fiscal years from $3.03 three years ago. ROE was 18.72% in the last year, which compares to 19.15% three years ago. Forward 12M revenue is expected to grow by 3.07% and the stock is trading with a Forward 12M P/E of 21.37.
Innoviva Inc (INVA)
Next on the Top Buy list today is Innoviva Inc with AI-based factor scores of B in Technical, C in Growth, A in Momentum Volatility, and A in Quality Value. The stock is down 16.3% for the year already but looks to head higher from here and is an excellent entry point for investors. The company develops biopharmaceutical drugs in the antibiotic, respiratory, and digestive realms. As for the financials, revenue grew by 14.69% in the last fiscal year to $261.02M, a growth of 37.81% over the last three fiscal years from $217.22M three years ago. Operating Income grew by 16.23% in the last fiscal year to $246.36M, a growth of 55.95% over the last three fiscal years from $183.6M three years ago. EPS grew by 44.92% in the last fiscal year to $1.39, and grew by 79.59% over the last three fiscal years from $1.12 three years ago. ROE was 76.22% in the last year. The stock is trading with a Forward 12M P/E of 7.85.
Laboratory Corp of America Holdings (LH)
Next on the Top Buy list is Laboratory Corp of America Holdings with AI-based factor scores of A in Technical, A in Growth, B in Momentum Volatility, and C in Quality Value. The stock has done decently this year, now sporting a gain of 5.93% overall. The company is one of the nation's two largest independent clinical laboratories, with roughly 20% of the independent lab market. As for the financials, Revenue grew by 11.32% over the last three fiscal years to $11554.8M in the last fiscal, which compares to $10308.0M three years ago. Operating Income was $1465.2M in the last fiscal year, which compares to $1376.1M three years ago. EPS was $8.35 in the last fiscal year, less than the $11.81 three years ago. ROE was 11.32% in the last year, lower than the 19.97% three years ago. Forward 12M Revenue is expected to grow by 7.6% and the stock is trading with a Forward 12M P/E of 10.57.
Thor Industries Inc (THO)
Another Top Buy today that has been on this column before is Thor Industries Inc with AI-based factor scores of A in Technical, C in Growth, C in Momentum Volatility, and C in Quality Value. The stock is up 33.47% for the year already, and looks set to head higher. The company is an American manufacturer of recreational vehicles through its subsidiaries. The company reports through three segments: North American towable recreational vehicles, North American motorized recreational vehicles, and European recreational vehicles. Revenue grew by 3.69% in the last fiscal year to $7864.76M, a growth of 12.53% over the last three fiscal years from $7246.95M three years ago. EPS grew by 43.61% in the last fiscal year to $2.47, compared to $7.09 three years ago. Operating Income was $422.83M in the last fiscal year, which compares to $559.81M three years ago. ROE was 6.57% in the last year, which compares to 26.34% three years ago. Forward 12M Revenue is expected to grow by 14.72% and the stock is trading with a Forward 12M P/E of 17.92.
Williams-Sonoma Inc (WSM)
Our final Top Buy today is Williams-Sonoma Inc, the company that is a leader in the $117 billion home furnishings category. Our AI systems have identified factor scores of B in Technical, B in Growth, B in Momentum Volatility, and A in Quality Value for the stock that is up 23.29% for the year already. Revenue grew by 1.93% in the last fiscal year to $5898.01M, a growth of 13.6% over the last three fiscal years from $5292.36M three years ago. Operating Income grew by 22.82% in the last fiscal year to $469.15M, and grew by 26.08% over the last three fiscal years from $457.01M three years ago. EPS grew by 15.99% in the last fiscal year to $4.49, which compares to a growth of 72.45% over the last three fiscal years from $3.02 three years ago. ROE was 29.78% in the last year, which compares to 21.17% three years ago. Forward 12M Revenue is expected to grow by 0.28% and the stock is trading with a Forward 12M P/E of 14.83.
