The U.S. stock market enters the second half of 2026 on a solid footing, supported by resilient economic growth, healthy corporate earnings and easing geopolitical tensions. While the Federal Reserve has adopted a more hawkish stance and investors are weighing the possibility of another interest-rate hike, cooling oil prices and steady consumer spending remain reasons for optimism.
Market leadership has also started to broaden beyond the artificial intelligence-driven rally, with defensive sectors such as healthcare and consumer staples attracting fresh interest. This rotation reflects a healthier market rather than a weakening one, as investors look for companies with stable earnings and strong fundamentals. In this environment, focusing on stocks showing strong relative price strength can be an effective strategy, as they often continue to outperform even when market leadership shifts.
At this stage, investors would be wise to consider companies, such as Neurocrine Biosciences NBIX, MYR Group MYRG, Block XYZ, Delek US Holdings DK and Dycom Industries DY.
Relative Price Strength Strategy
Earnings growth and valuation multiples are indeed important for investors to determine a stock's ability to offer considerable returns. However, these are also essential for determining whether a stock’s price performance is better than its peers or the industry average.
If a stock’s performance is lacking that of the broader groups, despite impressive earnings growth or valuation multiples, then something must be wrong.
It’s always advisable to stay away from these stocks and bet on those that are outperforming their respective industry or benchmark. This is because betting on a winner always proves to be lucrative.
Then again, it is imperative that you determine whether or not an investment has relevant upside potential when considering stocks with significant relative price strength. Stocks delivering better than the S&P 500 for 1 to 3 months, at least, and having solid fundamentals, indicate room for growth and the best way to go about this strategy.
Finally, it is crucial to find out whether analysts are optimistic about the upcoming earnings of these companies. In order to do this, we have added positive estimate revisions for the current quarter’s (Q1) earnings to our screen. When a stock undergoes an upward revision, it leads to additional price gains.
Screening Parameters
Relative % Price change – 12 weeks greater than 0
Relative % Price change – 4 weeks greater than 0
Relative % Price change – 1 week greater than 0
(We have considered those stocks that have been outperforming the S&P 500 over the last 12 weeks, four weeks and one week.)
% Change (Q1) Est. over 4 Weeks greater than 0: Positive current-quarter estimate revisions over the last four weeks.
Zacks Rank equal to 1: Only Zacks Rank #1 (Strong Buy) stocks — that have returned more than 26% annually over the last 26 years and surpassed the S&P 500 in 23 of the last 26 years — can get through. You can see the complete list of today’s Zacks #1 Rank stocks here.
Current Price greater than or equal to $5 and Average 20-day Volume greater than or equal to 50,000: A minimum price of $5 is a good standard to screen low-priced stocks, while a high trading volume would imply adequate liquidity.
VGM Score less than or equal to B: Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best upside potential.
Here are five of the 10 stocks that made it through the screen:
Neurocrine Biosciences: Neurocrine Biosciences develops therapies for neurological, psychiatric, endocrine and immune disorders. Its marketed drugs, INGREZZA and CRENESSITY, drive growth, while a broad pipeline supports future treatment options.Over the past 60 days, the Zacks Consensus Estimate for the company’s 2026 earnings has moved up 18.8%. NBIX has a VGM Score of A.
Neurocrine Biosciences beat the Zacks Consensus Estimate for earnings in three of the last four quarters and missed in the other. It has a trailing four-quarter earnings surprise of roughly 6.9%, on average. NBIX shares have gained 31.7% in a year.
MYR Group: MYR Group is a leading electrical construction company serving the United States and Canada. Through its Transmission & Distribution and Commercial & Industrial segments, it delivers power infrastructure, data center, transportation, healthcare and clean energy projects. The Zacks Consensus Estimate for MYR Group’s 2026 earnings indicates 51.8% growth. MYRG has a VGM Score of B.
The firm has a market capitalization of around $7.8 billion. Over the past 60 days, the Zacks Consensus Estimate for MYR Group’s 2026 earnings has gone up 15.2%. MYRG’s shares have surged 176.9% in a year.
Block: Block offers financial and marketing services through a commerce ecosystem that helps sellers start, run and grow their businesses. The company’s expected EPS growth rate for three to five years is currently 31.8%, which compares favorably with the industry's growth rate of 22.8%. XYZ has a VGM Score of A.
Over the past 60 days, the Zacks Consensus Estimate for Block’s 2026 earnings has moved up 13.8%. The Zacks Consensus Estimate for 2026 earnings of the company indicates 5% growth. XYZ shares have gained 11.3% in a year.
Delek US Holdings: Brentwood, TN-based Delek US Holdings is an independent refiner, transporter and marketer of petroleum products. DK’s expected EPS growth rate for three to five years is currently 29.4%, which compares favorably with the industry's growth rate of 25.5%. The company has a VGM Score of A.
DK has a trailing four-quarter earnings surprise of roughly 215.8%, on average. Over the past 60 days, the Zacks Consensus Estimate for the downstream operator’s 2026 earnings has moved up from $3.66 per share to $5.27. Delek’s shares have gone up 133.8% in a year.
Dycom Industries: Dycom is a specialty contracting firm operating in the telecom industry. It provides diverse services such as engineering, construction, maintenance and installation services for the cable and telephone companies. The Zacks Consensus Estimate for fiscal 2027 earnings of Dycom indicates 28.8% growth. DY has a VGM Score of B.
Over the past 60 days, the Zacks Consensus Estimate for Dycom’s fiscal 2027 earnings has moved up 19.7%. The company has a market capitalization of $15.2 billion. DY shares have gone up 107% in a year.
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MYR Group, Inc. (MYRG): Free Stock Analysis Report
Delek US Holdings, Inc. (DK): Free Stock Analysis Report
Neurocrine Biosciences, Inc. (NBIX): Free Stock Analysis Report
Dycom Industries, Inc. (DY): Free Stock Analysis Report
Block, Inc. (XYZ): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).