With the rapid rollout of COVID-19 vaccines, the economy is now in a rebuilding phase. A solid start to the third-quarter earnings season, a fall in initial jobless claims, and a low-interest-rate environment should translate to bullish market sentiment in the near term. So, we think quality stocks Ultralife (ULBI), FONAR (FONR), and Good Times (GTIM), which look undervalued at their current price levels, could be solid bets now. Let’s discuss.A solid start to the third-quarter earnings season has made investors bullish, as evidenced by the impressive performances of the major stock market indexes. According to FactSet, through October 15, 8% of the companies in the S&P 500 had reported results for Q3 2021, and 80% of them have surpassed consensus EPS estimates, which surpasses the 76% five-year average. This, along with a low-interest-rate environment and decline in initial jobless claims, should keep the stock market upbeat in the near term.
While high inflation and supply chain constraints remain concerns, initial jobless claims fell below 300,000 for the week ended October 9, for the first time since the initial days of the COVID-19 pandemic.
Given this backdrop, we think it could be wise to bet on quality stocks Ultralife Corporation (ULBI), FONAR Corporation (FONR), and Good Times Restaurants Inc. (GTIM). They each look undervalued at their current price levels.