Why Momentum Investors Should Consider U.S. Cellular (USM) Stock

As investors with varying strategies scout the market for rewarding stocks, they often benefit from research tools that can guide their investment decisions. One such tool is the Zacks Style Scores system, a feature of Zacks Premium, which evaluates stocks based on their value, growth, and momentum attributes.

Zacks Style Scores are designed to complement the Zacks Rank—a proprietary stock-rating model that has historically resulted in a +25.41% average annual return since 1988, greatly outperforming the S&P 500's return in the same period. While Zacks Rank focuses on earnings estimate revisions to predict stock movements, Style Scores provide additional insight by scoring stocks from A to F in three investment categories: Value, Growth, and Momentum.

For instance, value investors seek stocks priced lower than their intrinsic value, and the Value Score aids in discovering such opportunities. Growth investors, conversely, look for companies with strong financial performance and potential, which the Growth Score helps identify. Lastly, momentum investors focus on riding existing trends in stock prices or earnings outlooks, and the Momentum Score indicates opportune moments to invest in high-momentum stocks.

TDS and USM, both anchored in Chicago, Illinois, are two stocks that epitomize high potential according to the Zacks metrics. TDS, or Telephone and Data Systems, Inc., delivers a broad array of communications services across the United States. USM, or United States Cellular Corporation, a subsidiary of TDS, offers comprehensive wireless telecommunications services.

USM currently holds a coveted #1 (Strong Buy) ranking on the Zacks Rank and has received a laudable VGM Score of B. For momentum investors, its Momentum Style Score of A is particularly noteworthy, coupled with a 0.6% uptick over the past four weeks. Furthermore, fiscal projections for USM are favorable, with upward revisions from analysts and an anticipated earnings improvement, all underscoring the stock's potential. Moreover, USM's track record of average earnings surprises adds another layer of attractiveness for investors. With solid Zacks Rank and impressive Momentum and VGM Style Scores, USM stands out as a compelling pick for investors' portfolios.

Investment, Momentum, Research