Zacks Indicator Model & Zacks Rank

Zacks Indicator Model & Zacks Rank

A Closer Look

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Our flagship tools have helped investors and advisors for more than 30 years.

In 1978, Zacks' founder and CEO hit upon a key discovery:

Earnings estimate revisions are the most powerful force impacting stock prices.

This idea was developed into the Zacks Indicator Model, the firm's flagship model. Over the last three decades, the Indicator has produced an annualized return of approximately 24%. During the same period, the S&P 500 returned approximately 10% annually.

How the Zacks Indicator Model and Zacks Rank work.

The Zacks Indicator Model ranks approximately 4,500 stocks from best to worst based on the idea that investors can capitalize on stock price movements resulting from EPS estimate revisions and earnings surprises. The Zacks Rank is derived from the Zacks Indicator Model's composite score and assigns a simplified 1 to 5 score (1= best and 5 = worst). Only the top 5% of stocks receive the coveted Zacks #1 Rank, and approximately the same number receive the Zacks #5 Rank.

Annualized Returns for Zacks Indicator Model and Zacks Rank Stocks (January 1, 1988 ? December 31, 2020)

Indicator 1-2

1-5

1-10

6-20

Score Top 2%

Top 5%

Top 10%

21-79

Zacks Rank

Annualized 27.9% 24.9% 23.3% 18.5% 10.2%

80-94 90-99 95-99 98-99

Bottom 10% Bottom 5% Bottom 2%

6.0% 3.5% 2.7% 2.6%

Equally Weighted Universe

S&P 500

11.5% 11.0%

How investors use the Zacks Indicator Model and Zacks Rank.

The optimal time horizons for the Zacks Indicator Model and Zacks Rank are 1-6 months. For this reason, many institutional investors use them as a timing tool rather than a method of picking long-term outperformers.

Examples of common uses of these tools include:

? Tiebreakers to pick among equally attractive stocks ? Screening for new purchase candidates ? Tiebreakers to pick among stocks in an industry group ? One component multi-factor

Zacks Indicator Model

Historical Performance (%)

Results from January 1, 1988 - December 31, 2020

Year Top 2%

2020 December 2020 November 2020

October 2020 September 2020

August 2020 July 2020 June 2020 May 2020 April 2020

March 2020 February 2020 January 2020

2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988

Annualized

33.25 4.51 18.74 -1.27 5.51 -1.14 4.83 7.56 13.11

25.63 -26.72

-7.24 -4.26 17.4 -12.6 33.5 32.3

-1.4 14.8 47.8 27.9 -4.6 32.3 56.3 -41.4 24.7 26.1 25.1 37.4 75.6 8.6 24.7 24.8 58.8 28.3 48.8 48.1 52.7 24.9 51.5 46.5 101.4 -7.0 39.1 43.8

27.9

Top 5%

33.86 4.23 17.58 -1.27 3.76 -0.78 4.81 10.25 16.26 20.32 -26.42 -6.82 -3.04 23.8 -7.4 28.3 27.4 0.0 14.9 47.5 24.9 -3.8 29.0 65.9 -40.4 19.7 27.3 18.8 28.7 67.0 1.2 24.3 14.3 45.9 19.5 43.9 40.9 52.6 12.7 45.3 41.0 81.4 -2.6 39.6 39.2

24.9

Top 10%

42.73 4.41 17.71 -0.56 3.62 -0.61 5.67 10.08 15.81 22.31 -24.87 -6.95 -1.53 23.6 -7.1 27.0 28.5 4.6 14.4 45.0 24.8 -2.8 32.2 75.2 -40.7 13.8 27.7 16.4 29.4 77.3 -9.1 14.3 8.4 39.1 17.5 38.9 37.3 53.9 12.6 35.0 34.1 69.1 -5.4 40.0 37.7

23.3

Bottom 10% Bottom 5% Bottom 2%

19.21 6.13 27.57 -2.38 -0.14 4.37 -0.19 4.95 12.23 17.66 -27.86 -9.14 -4.56 16.3 -15.8 11.6 29.0 -17.7 -7.8 25.6 8.4 -18.4 28.2 54.2 -47.2 -19.0 16.6 -3.1 14.2 53.0 -20.4 24.2 -8.8 17.3 -14.2 4.8 10.7 11.7 -13.1 6.3 15.0 33.6 -33.0 0.6 16.9

3.5

19.77 5.47 26.94 -2.41 -1.53 4.68 -0.05 5.32 13.57 19.44 -26.55 -9.96 -5.84 17.1 -15.9 13.0 39.4 -19.0 -14.4 18.0 8.1 -21.4 27.2 49.4 -50.9 -24.0 18.2 -6.0 14.6 54.4 -15.9 20.2 -4.0 17.7 -14.8 3.1 8.0 9.1 -10.9 9.5 17.3 34.4 -34.7 -5.1 18.4

2.7

18.56 5.42 32.57 -1.52 -2.67 5.39 -1.34 4.63 13.53 21.24 -28.45 -10.16 -8.06 12.8 -16.0 9.3 31.1 -24.2 -14.5 23.2 10.0 -16.8 21.1 63.8 -51.8 -21.9 14.5 -1.6 16.8 47.3 -14.6 38.6 -8.3 17.7 -16.0 0.9 9.5 2.7 -13.6

7.4 13.4 43.8 -34.6 -6.9 23.8

2.6

Equally Weighted Universe

33.94 5.31 23.61 -0.90 1.87 1.45 2.62 8.92 13.05 19.02 -25.98 -8.02 -1.89 19.6 -10.5 17.0 27.3 -9.8 2.4 30.7 15.3 -12.9 29.2 74.5 -47.2 -4.1 18.5 6.5 18.2 64.0 -16.9 15.0 -7.9 34.3 1.5 23.2 18.1 30.0 -2.8 17.1 18.0 46.9 -20.6 16.3 22.2

11.5

S&P 500

19.27 2.13 11.78 -1.73 0.20 2.55 3.77 4.72 8.20 8.86

-13.08 -7.84 0.91 29.4 -3.8 21.4 14..8

0.2 13.3 32.4 16.0 2.1 15.1 26.5 -37.0 5.5 15.8 4.9 10.9 28.7 -22.1 -11.9 -9.1 21.0 28.6 33.4 23.0 37.6 1.3 10.1 7.6 30.5 -3.1 31.7 16.6

11.0

Zacks Rank

Historical Performance (%)

Results from January 1, 1988 - December 31, 2020

Year

2020 December 2020 November 2020

October 2020 September 2020

August 2020 July 2020 June 2020 May 2020 April 2020

March 2020 February 2020 January 2020

2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988

Annualized

#1 Rank

33.86 4.23 17.58 -1.27 3.76 -0.78 4.81 10.25 16.26 20.32 -26.42 -6.82 -3.04 23.8 -7.4 28.3 27.4 0.0 14.9 47.5 24.9 -3.8 29.0 65.9 -40.4 19.7 27.3 18.8 28.7 67.0

1.2 24.3 14.3 45.9 19.5 43.9 40.9 52.6 12.7 45.3 41.0 81.4 -2.6 39.6 39.2

24.9

#2 Rank

39.71 5.22 19.70 -0.16 3.00 -0.92 5.01 9.29 14.28 21.58 -25.12 -8.01 -0.88 27.1 -6.7 23.2 27.1 -0.9 10.3 37.2 19.1 -4.9 35.2 84.2 -43.5

5.4 26.3 12.6 23.7 69.5 -13.5 11.7 -1.5 35.5 12.9 33.9 28.6 46.8 5.2 26.9 29.6 56.8 -13.7 26.8 29.7

18.5

#3 Rank

34.35 5.26 23.11 -0.80 2.00 1.37 2.42 9.14 12.79 19.16 -25.71 -8.01 -1.55 17.4 -10.2 15.1 27.2 -11.0

1.2 30.6 16.4 -13.5 27.9 78.8 -48.7 -4.3 16.8 6.7 15.8 64.9 -17.8 14.1 -17.8 31.0 -3.5 22.9 16.1 30.6 -3.6 14.8 18.0 46.0 -21.3 15.9 20.8

10.2

#4 Rank

30.43 5.87 30.75 -1.42 0.70 3.94 1.16 8.14 11.51 15.01 -27.53 -7.85 -2.54 20.1 -14.2 16.3 21.0 -13.8 -4.0 23.9 6.5 -18.6 29.3 60.4 -45.7 13.1 15.0 0.5 11.5 55.0 -24.0 17.9 -19.5 18.5 -8.8 10.2

7.7 17.4 -11.1 8.6 12.2 36.6 -23.9 9.6 19.1

6.0

#5 Rank

19.77 5.47 26.94 -2.41 -1.53 4.68 -0.05 5.32 13.57 19.44 -26.55 -9.96 -5.84 17.1 -15.9 13.0 39.4 -19.0 -14.4 18.0

8.1 -21.4 27.2 49.4 -50.9 -24.0 18.2 -6.0 14.6 54.4 -15.9 20.2 -4.0 17.7 -14.8

3.1 8.0 9.1 -10.9 9.5 17.3 34.4 -34.7 -5.1 18.4

2.7

S&P 500

19.27 2.13 11.78 -1.73 0.20 2.55 3.77 4.72 8.20 8.86 -13.08 -7.84 0.91 29.4 -3.8 21.4 14.8 0.2 13.3 32.4 16.0 2.1 15.1 26.5 -37.0 5.5 15.8 4.9 10.9 28.7 -22.1 -11.9 -9.1 21.0 28.6 33.4 23.0 37.6 1.3 10.1 7.6 30.5 -3.1 31.7 16.6

11.0

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