Watch These 3 "Mag 7" Stocks Showing Positive Momentum

A Driehaus-inspired 'buy high and sell higher' momentum strategy has identified Amazon (AMZN), Alphabet (GOOGL), and Meta Platforms (META) as top picks, demonstrating robust positive momentum and fundamental strength. The selection criteria include strong EPS growth, significant earnings surprises (e.g., AMZN 23%, GOOGL 16%, META 20.5% average surprise), positive 50-day moving average, positive relative strength, and specific Zacks Rank #3 and Momentum Scores (A or B). This rigorous screening process, which narrowed over 7,700 stocks to just 13, aims to pinpoint high-potential outperformers for long-term returns.

Analysis

A quantitative screening model inspired by Richard Driehaus's 'buy high and sell higher' momentum strategy has identified Amazon (AMZN), Alphabet (GOOGL), and Meta Platforms (META) as current top picks. The strategy uniquely combines technical momentum indicators with stringent fundamental requirements, filtering a universe of over 7,700 stocks down to just 13. The selected firms exhibit positive momentum signals, including prices above their 50-day moving averages and positive relative strength. Crucially, this technical strength is supported by robust fundamentals, such as trailing twelve-month EPS growth exceeding industry medians and a history of significant earnings beats. Specifically, the average trailing four-quarter earnings surprises were 23% for Amazon, 16% for Alphabet, and 20.5% for Meta. The model's inclusion of a Zacks Rank #3 (Hold) alongside a Momentum Score of A or B suggests the strategy targets fundamentally sound companies in a confirmed uptrend that still possess solid upside potential, rather than simply chasing top-ranked names.

Key Decisions for Investors

• Investors with a momentum mandate should view these signals as strong validation for existing or new positions in AMZN, GOOGL, and META, as they satisfy a dual-factor screen of price momentum and fundamental outperformance.
• The substantial and consistent earnings surprises, ranging from 16% to 23%, provide a fundamental justification for the stocks' current valuations and uptrends, potentially offering a degree of downside protection compared to purely speculative momentum plays.
• It is critical to monitor the 50-day moving average and relative strength indicators for these names, as a negative crossover would invalidate a key premise of the Driehaus-based 'buy high' thesis.
• The fact that these stocks qualified from a highly selective screen of just 13 names suggests a high degree of quantitative support, which could increase conviction for investors looking to capitalize on the ongoing strength in mega-cap technology.