For those seeking fast money stocks, most of 2022 has been a veritable nightmare. With an influx of severe headwinds – particularly soaring inflation and geopolitical flashpoints – the equities sector represented a value trap. Few traders outside of those placing short bets enjoyed the volatility of the year so far. However, with much of the bad news baked in, it’s possible that certain undervalued fast money stocks can bounce back. Under this context, I’m seeking high-momentum names (or those that own the potential to engineer such momentum) for speculators in a hurry.
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One of the biggest financial institutions in the world, Citigroup (NYSE:C) wouldn’t ordinarily qualify as one of the fast money stocks to buy. However, these are no ordinary times. With inflation reaching historic highs combined with geopolitical flashpoints, most equities sectors plunged this year. However, the financial sector appears to have garnered positive momentum, drawing attention to C stock.
Specifically, Citigroup shares gained slightly over 10% in the trailing month since the close of the Nov. 21 session. However, on a year-to-date basis, C stock still finds itself down 22.5%, possibly suggesting greater room for growth. To be fair, the narrative is a speculative one. Essentially, with the Federal Reserve still committed to a hawkish monetary policy, subsequent economic weaknesses could hurt banking firms.
Nevertheless, contrarians will almost surely find C attractive. Currently, shares trade for just under 7-times forward earnings. In contrast, the forward price-earnings ratio for the banking industry is 8.6 times, implying that C is undervalued.
BHP Group (BHP)
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Based in Australia, BHP Group (NYSE:BHP) is a metals and mining powerhouse. Its vast portfolio also includes natural gas and petroleum products, making it exceptionally relevant. Certainly, with Russia effectively blackmailing western nations with its hydrocarbon energy outflow cuts, more countries will rely on friendly jurisdictions like Australia.
Another factor that bolsters BHP centers on its relevancies for the industries of tomorrow. With the company producing copper and nickel among other key commodities, BHP will likely undergird the future of mobility; in other words, electric vehicle production. At the moment, BHP enjoys significantly positive momentum. In the trailing month, shares gained nearly 17% of equity value. Since the start of the year, BHP is up a little over 6%, reflecting one of the few publicly traded securities in the black. Still, BHP trades for only 7-times trailing-12-month (TTM) earnings. In contrast, the sector median PE ratio is nearly 12 times. Therefore, BHP is worth a look regarding fast money stocks to buy.
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One of the more compelling albeit riskier wagers in the global hydrocarbon sector, Brazil’s Petrobras (NYSE:PBR) gained just over 2% of equity value since the start of this year. Compared to other hydrocarbon players, that’s a rather disappointing performance. Still, those with a contrarian mindset regarding fast money stocks to buy should give another look at PBR. Specifically, PBR ranked among the highlights for unusual options activity for the session ended Nov. 21. Traders bid up multiple long call options with far expiration dates. For instance, the $8 calls with an expiration date of Jan. 17, 2025 stands 787 days away from expiration since the order was placed. Despite the Fed’s intentions to control inflation, many traders view the macroeconomic backdrop as net positive for PBR stock.
It’s hard to disagree. Corporate surveys (domestically) indicate that 90% of companies intend to resume in-office operations by 2023. Should other nations follow suit, Petrobras’ total addressable market will rise. Thus, PBR represents one of the fast money stocks to buy.
General Motors (GM)
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Over the past several decades, American automakers became the butt of jokes due to their poor quality. However, in recent years, Detroit began seriously flexing its muscles. A clear example stems from General Motors (NYSE:GM). With the introduction of the eighth-generation Corvette along with the electrification of its several popular brands, GM offers a balanced approach to the future of mobility.
Essentially, the automaker will cater to two distinct consumer bases until it’s no longer viable to do so. For right now, robust demand for the Corvette reveals that gearheads will continue to command a strong presence. However, GM will not let its EV segment slide. For instance, a popular pizza chain just secured a deal to buy EV fleets from GM. Fortunately for those seeking fast money stocks to buy, the fundamentals have translated to positive chart performance. Over the trailing month, GM shares gained almost 11% of equity value. As well, let’s not forget that GM is incredibly undervalued. Currently, shares trade at 6.3-times forward earnings, ranking favorably below 80% of the competition.
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Another unusual name for fast money stocks to buy, Louisiana-Pacific (NYSE:LPX) is an American building materials manufacturer. Unfortunately, with the broader economy suffering from recessionary fears throughout 2022, LPX struggled. Since the January opener, shares tumbled nearly 20% of equity value. This performance is actually a bit worse than the benchmark S&P 500 index.
Still, LPX may benefit from political initiative such as the so-called Build Back Better bill. With Washington focused on restoring American infrastructure following the coronavirus disaster, LPX may become a downwind beneficiary. Certainly, it appears that investors received the memo. In the trailing month, shares gained over 11% of market value. Further, the political impetus could make LPX a long-term idea, not just for fast money stocks.
Finally, Louisiana-Pacific will likely court additional investors because of its value proposition. Currently, shares trade at 4-times TTM earnings. In contrast, the sector median PE ratio is a lofty 13 times. As well, the company enjoys a stable balance sheet, strong revenue trends and outstanding profitability metrics.
A consumer retail firm that sells kitchenware and home furnishings, Williams-Sonoma (NYSE:WSM) is a higher-risk name among fast money stocks. Just look at the consumer sentiment index, which presently trends near historic lows. Unless this index swings higher, the presumption is that WSM will struggle. Certainly, shares fell over 29% YTD, reflecting deep concerns. So, why mention WSM at all as one of the fast money stocks to buy? The thing is, Williams-Sonoma doesn’t cater to your regular consumer base. Rather, the company’s pricey products attract higher-income crowds. And the reality of the post-pandemic new normal dictates that affluent segment made off like bandits. Stated differently, WSM enables investors to cynically bank on trends associated with the widening wealth gap.
Furthermore, Williams-Sonoma brings an attractive value proposition to the table. The company enjoys a solid balance sheet and outstanding revenue and profit margins. Even with these attributes, WSM trades at only 7.6-times forward earnings. This compares with the industry median forward PE ratio of 14.2 times.
Signet Jewelers (SIG)
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Personally, if I had to pick a name among fast money stocks to buy, I’d probably go with the first six names. However, those that truly want to bank on the wealth gap phenomenon can target Signet Jewelers (NYSE:SIG). To be clear, SIG dropped nearly 33% of equity value since the start of this year. However, in the trailing six months, SIG gained almost 14%, reflecting budding enthusiasm.
Also, Signet plays into social trends following the disruption of the Covid-19 pandemic. As many research papers and journalistic reports indicated, social isolation represented a huge problem during the worst of the crisis. Now that the broader ecosystem is normalizing, it’s an opportunity for folks to reconnect. And you never know – this circumstance may have sparked pent-up demand for marriages, which would bode well for SIG stock.
On a final note, those that want to take the plunge should note that Signet also offers an attractive value proposition. Currently, SIG trades at 5.4-times forward earnings, which ranks below nearly 93% of the competition.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.
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