February Job Data Solid: Top Stocks From Best Sectors

Stoking growth in the U.S. economy further, the February job growth data marked the best in more than one-and-a-half years. U.S. employers added 313,000 jobs in February, after an upwardly revised 239,000 in January and surpassing market expectations of 200,000 jobs.

The rate of unemployment was 4.1% — unchanged from the prior month's 17-year low and slightly above market expectations of 4%. The average workweek recovered to 34.5 hours from 34.4 hours in January.

Though wage growth rose 0.1% to $26.75 in February, marking a slowdown from the 0.3% rise in January, some economists do not view this as a concern. Per Reuters, this group of economists believes that wage growth has actually been stronger than indicated by average hourly earnings, which appears more volatile on a monthly basis.

Against this backdrop, it is intriguing to look at the sectors that have generated the highest number of jobs. Below we highlight those sectors and stocks with a Zacks Rank #1 (Strong Buy) from each of the sectors.

Construction

Per tradingeconomics, construction created 61,000 jobs. The sector has added 185,000 jobs over the past four months. Specialty trade contractors and construction of buildings added about 38,000 and 16,000 jobs, respectively.

NCI Building Systems Inc. (NYSE:NCS)

The company is an integrated manufacturer of metal products for the building industry, belonging to a Zack Industry with a rank in the top 7%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Retail

Tradingeconomics indicated that retail trade employment rose by 50,000 in February. Within the industry, 18,000 employment jobs were added in general merchandise stores while clothing and clothing accessories stores generated 15,000 jobs.

J.Jill Inc. (NYSE:JILL)

The Zacks Rank #1 stock operates as a specialty retailer of women’s apparel. The stock belongs to a top-ranked Industry (top 48%) and Sector (top 50%). It has a VGM Score of A.

Business Services

Jobs in professional and business services jumped 50,000 in February and have grown by 495,000 over the year. Employment in temporary help services increased by 27,000 over the month.

CRA International Inc. (NASDAQ:CRAI)

This is an economics, finance, and business consulting firm that works with businesses, law firms, accounting firms, and governments in providing a wide range of services. The company hails from a top-ranked Zacks sector (top 31%). The stock has a VGM Score of A.

Manufacturing

The manufacturing sector added 31,000 jobs in February. Over the past year, manufacturing has created 224,000 jobs.

Lincoln Electric Holdings Inc. (NASDAQ:LECO)

The company is engaged in the designing, developing and manufacturing of arc welding products, robotic arc welding systems, plasma and oxy-fuel cutting equipment. The stock is from a top-ranked Zacks Industry (top 11%) and Zacks Sector (top 6%). It has a VGM Score of C.

Financials

The financial activities sector added 28,000 jobs in February. In a rising rate environment, stocks perform better. If the sentiments around the economy remain stable and the Fed is steadfast on hiking rates, bond yields may go up. This would be a positive for the stocks.

World Acceptance Corporation (NASDAQ:WRLD)

The company is engaged in the small-loan consumer finance business. It hails from a top-ranked Zacks Industry (top 25%) and has a VGM Score of B.

HealthCare

Jobs in the health care sector rose 19,000 in February, while hospitals employed 9,000 more. The sector has added 290,000 jobs over the past year, per tradingeconomics.

HCA Holdings, Inc. (NYSE:HCA)

This is a non-governmental hospital in the United States providing health care and related services. The stock belongs to a top-ranked industry (top 12%) and has a VGM Score of A.

Mining

According to tradingeconomics, about 9,000 jobs were created in the mining sector in February. Since the low hit in October 2016, mining has managed to add 69,000 jobs.

Arch Coal Inc. (NYSE:ARCH)

This natural resource company has a VGM Score of A.

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