The 'Mid-Cap Movers' strategy focuses on a selection of companies that represent the cream of the crop of financial stability.
Distinguished by their ability to move fast without offering an overly risky profile, these companies are generally lesser-known to the general public and yet present solid growth prospects.
By targeting 20 such stocks, our advanced AI models have safely outperformed the benchmark S&P 500 by 345.4% over the last decade, as seen in the chart below:
Source: InvestingPro ProPicks
The strategy is rebalanced on a monthly basis, guaranteeing that our users stay ahead of curve amid shifting market dynamics and an ever-changing macroeconomic environment.
Now, let's highlight three stocks currently in the strategy, namely Shift4 Payments, PBF Energy, and Hub Group, which are covered below in detail.
InvestingPro users can see the full strategy - along with the other five ProPicks strategies - on our ProPicks gallery page.
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1. Shift4 Payments (FOUR)
- InvestingPro Health Label: Great
- InvestingPro Fair Value: Undervalued (39.6% Upside)
- Forward P/E Ratio: 37.1x
- Dividend Yield: 0.0%
Shift4 Payments (NYSE:FOUR) offers a range of software and payment processing solutions in the United States. Their services include omni-channel card processing (credit, debit, contactless, and mobile wallets), merchant acquiring, and proprietary omni-channel gateway. The company provides integrated and mobile point-of-sale (POS) systems, security and risk management tools, e-commerce solutions, etc.
Shares are up 35.8% in the past month and 15.7% year to date.
What do Wall Street analysts say?
According to analysts surveyed by InvestingPro, Shift4 Payments is Fairly valued with 17.6% Upside.
Earlier this month, Redburn-Atlantic initiated coverage on Shift4 Payments with a Sell rating and a price target of $49.00, writing:
Given the fundamentals behind Shift4 and the overlapping similarities to legacy payment businesses, we believe it is reasonable to value the company as a legacy payment business, not a disruptor. On this basis, Shift4 trades at a c40% 2025E non-GAAP P/E premium to legacy peers. When shifting the view to consider FCF and factoring in future Shift4 acquisitions, it becomes evident that Shift4’s valuation resembles that of a disruptor, not a legacy player.
In October, Wells Fargo initiated coverage on Shift4 Payments with an Overweight rating, and Berenberg and UBS started coverage with Buy ratings.
Key recent news
In November, Shift4 Payments reported Q3 earnings of $0.82 per share, compared to the consensus estimate of $0.69.
In October, Shift4 completed its previously announced acquisition of Finaro, a cross-border e-commerce payments provider and fully licensed bank with a large European presence. The completion of this acquisition significantly expands Shift4’s total addressable market both in terms of geographic coverage and industry verticals.
2. PBF Energy (PBF)
- InvestingPro Health Label: Great
- InvestingPro Fair Value: Undervalued (29.2% Upside)
- Forward P/E Ratio: 1.8x
- Dividend Yield: 2.4%
PBF Energy (NYSE:PBF) engages in refining and supplying petroleum products. The company operates in two segments, Refining and Logistics. It produces gasoline, ultra-low-sulfur diesel, heating oil, diesel fuel, jet fuel, lubricants, petrochemicals, and asphalt, as well as unbranded transportation fuels, petrochemical feedstocks, blending components, and other petroleum products from crude oil.
Shares are down 6.2% in the past month and up 2.5% year to date.
What do Wall Street analysts say?
According to analysts surveyed by InvestingPro, PBF Energy is Undervalued with 24.4% Upside.
Most recently, in October, BMO Capital initiated coverage on PBF Energy with an Outperform rating and a price target of $60.00, writing:
Nobody has benefited more during the refining upcycle than PBF with elevated financial leverage incurred during COVID erased, while key PADD 1 and 5 markets have structurally improved from refinery closures and conversions, with more to come in California (Rodeo) and PADD 1 product inventories remaining tight. PBF has higher operating leverage to cracks, which have retraced recently, although its net cash position and discounted valuation supports a favorable risk/reward.
Key recent news
In November, PBF Energy reported Q3 earnings of $6.61 per share on revenue of $10.73 billion. Analysts were looking for $4.83 earnings on revenue of $9.99B.
3. Hub Group (HUBG)
- InvestingPro Health Label: Great
- InvestingPro Fair Value: Fairly valued (21.9% Upside)
- Forward P/E Ratio: 11.8x
- Dividend Yield: 0.0%
Hub Group (NASDAQ:HUBG), a supply chain solutions provider, offers transportation and logistics management services in North America. The company’s transportation services include intermodal, truckload, less-than-truckload, flatbed, temperature-controlled, and dedicated and regional trucking, as well as final mile, railcar, small parcel, and international transportation.
Shares are up 14.9% in the past month and 1.4% year to date.
What do Wall Street analysts say?
According to analysts surveyed by InvestingPro, Hub Group is Fairly valued with 6.1% Upside.
Most recently, in October, Wolfe Research upgraded Hub Group to Outperform from Peerperform. Meanwhile, JPMorgan downgraded the stock to Neutral from Overweight.
Key recent news
In October, Hub Group reported Q3 earnings of $0.97 per share on revenue of $1B. Analysts were looking for $1.17 earnings on revenue of $1.02B.
In November, Hub Group announced that its Board of Directors appointed Kevin Beth as the company’s Executive Vice President, Chief Financial Officer and Treasurer effective January 1, 2024, succeeding Geoffrey F. DeMartino.
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*Readers of this article can enjoy an exclusive 10% discount on our annual Pro+ plan with coupon code MCAPS1, and a similar discount of 10% on the bi-yearly Pro+ plan by using coupon code MCAPS2 at checkout!