Momentum
In instances where a stock price has experienced extreme negative returns relative to other stocks, it might appear cheap from a valuation perspective. However, it might be a “value trap.” To screen for such stocks, we rank the companies based on their 12-1 month momentum, which is calculated using the cumulative returns of the stock over the past 12 months, ignoring the most recent month. Any stock below the 30th percentile of values is restricted to a 3-star maximum rating.