U.S. weekly jobless claims drop to lowest level in 52 years: top 5 picks
Claims for weekly unemployment benefits in the United States have declined steadily over the past six months, except for a few minor fluctuations. The latest data released by the Labor Ministry on Nov. 24 showed initial demands plunged to their lowest level in 52 years. The labor market, which was the top performing segment of the US economy before the coronavirus outbreak, suffered the most during the pandemic. Lately, the US labor market has stabilized around the pre-pandemic level.
At this point, it will be fruitful to invest in endowment stocks with a favorable Zacks ranking. We have selected here five of these companies. These are – Korn Ferry KFY, Kforce Inc. KFRC, Cross Country Healthcare Inc. CCRN, Robert Half International Inc. RHI and Resource Connection, Inc. RGP.
Signs of systematic recovery
The Labor Department reported that weekly jobless claims plunged from 71,000 to 199,000 for the week ended November 20, marking the lowest level since November 15, 1969. The consensus estimate was 260,000 and The previous week’s data has been revised up to 270.00 from the 268,000 reported earlier. Notably, initial requests hovered around 200,000 during the pre-pandemic period.
Continuing claims (those who have already received government benefits) declined from $ 60,000 to $ 2.05 million for the week ending Nov. 13. This is the lowest figure since March 14, 2020. The total number of people receiving benefits under all programs fell from 752,390 to 2.43 million, as of November 6. In particular, recipients of unemployment benefits exceeded 30 million at the height of the pandemic.
Robust job additions in October
The US economy created 571,000 jobs in October, beating the consensus estimate of 442,000. In addition, September job creation was revised up to 312,000 from the disappointing 194,000 reported earlier. Data for August was also revised up to 483,000 from 366,000 reported earlier.
The total private wage bill rose by 604,000 in October, partially offset by 73,000 job cuts in the civil service. The unemployment rate fell to 4.6% in October from 4.8% in September. The consensus estimate was 4.7%.
Momentum is likely to continue
The US economy has experienced an impressive recovery since the start of 2021, faster than expected by a large number of market participants. The priority vaccination campaign and an unprecedented revival allowed the economy to accelerate the level of activities.
On November 15, President Joe Biden signed a bipartisan infrastructure bill of $ 550 billion in addition to previously approved funds of $ 450 billion for five years. Total spending could reach $ 1.2 trillion if the plan is extended over eight years.
The infrastructure development project will be a major catalyst for the US stock markets in 2022. Various segments of the economy such as basic materials, industrial products, utilities and telecommunications will benefit enormously from job creation for the economy.
Additionally, the White House pressured Congress to quickly pass legislation providing $ 52 billion to help computer chipmakers and alleviate a shortage of components vital to many industries.
Our top picks
We’ve narrowed our search down to five endowment stocks that have erupted in the past three months. These stocks have strong growth potential for the remainder of 2021 and have seen positive revisions to earnings estimates over the past 60 days. Each of our choices carries either a Zacks Rank # 1 (strong buy) or 2 (buy). You can see The full list of today’s Zacks # 1 Rank stocks here.
The chart below shows the price performance of our five picks over the past three months.
Image source: Zacks Investment Research
Kforce Inc. is a specialized, web-based recruiting company providing flexible and permanent recruiting solutions in the United States. KFRC operates through the Technology and Finance and Accounting segments. kforce.com offers web services including online resumes and job postings, interactive interviews, placements, and career management strategies.
Zacks Rank # 1 Kforce has an expected profit growth rate of 35.5% for the current year. Zacks’ consensus estimate for current year earnings has improved 10.3% in the past 30 days. The KFRC share price has jumped 40.3% in the past three months.
Korn Ferry is the first and largest executive search firm in the world with the broadest global presence in this industry. KFY operates through four segments: Consulting, Digital, Executive Search, Recruitment Process Outsourcing and Professional Search.
Zacks Rank # 2 Korn Ferry has an expected profit growth rate of over 100% for the current year (end of April 2022). Zacks’ consensus estimate for current year earnings has improved 0.6% in the past 7 days. The KFY share price has risen 17% in the past three months.
Cross Country Healthcare Inc. provides talent management and other advisory services to healthcare clients in the United States. The CCRN operates in three segments: nursing and paramedical staffing, physician staffing and research.
Zacks Rank # 1 Cross Country Healthcare has an expected earnings growth rate of over 100% for the current year. Zacks’ consensus estimate for current year earnings has improved 10% over the past 7 days. The CCRN share price has climbed 40.2% in the past three months.
Robert Half International Inc. provides recruitment and risk management consulting services in North America, South America, Europe, Asia and Australia. RHI operates through three segments: temporary and consulting staffing, permanent staffing, and risk advisory and internal audit services.
Zacks Rank # 1 Robert Half International has an expected profit growth rate of 95.9% for the current year. Zacks’ consensus estimate for current year earnings has improved 5.4% in the past 60 days. The RHI share price has jumped 14.3% in the past three months.
Connect Resources Inc. is a multinational professional services company that helps business leaders execute internal initiatives. RGP provides its clients with experienced professionals in accounting and finance, human resources management and information technology, project by project.
Zacks Rank # 1 Resources Connection has an expected earnings growth rate of -0.8% for the current year (ending May 2022). Zacks’ consensus estimate for current year earnings has improved 19.4% in the past 60 days. The RGP share price has appreciated 20.1% over the past three months.
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KornFerry International (KFY): Free Stock Analysis Report
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Resources Connection, Inc. (RGP): Free Stock Analysis Report
Kforce, Inc. (KFRC): Free Stock Analysis Report
Cross Country Healthcare, Inc. (CCRN): Free Inventory Analysis Report
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