All eyes will be on the September Federal Open Market Committee (FOMC) meeting. Unless there is extraordinary news, like collapsing crude oil prices, I am fully expecting a key Fed interest rate hike.
The Fed never fights market rates. Since market rates have risen globally due to higher energy prices, and after the ECB hike, more central banks are expected to follow and raise key interest rates.
The big news is expected to be the FOMC statement that may signal whether or not the Fed is “one and done” or signal that more key interest rate hikes will be forthcoming. Under new Fed Chairman Warsh, the Fed may not provide good guidance, since Warsh wants Wall Street to take its cue from market rates.
Related: Louis Navellier is buying 3 headline-making stocks, including Google
The good news is that with a hike already baked into the cake, there shouldn’t be a negative market reaction on September 16. In other words, don’t fear the reaper because even if interest rates rise and market volatility increases, fundamentally superior stocks continue to outperform. Ahead of the meeting, however, I suspect the stock market will trade sideways.
Here are three fundamentally and quantitatively superior stocks investors can consider to ride out the storm.
AI demand fuels Super Micro Computer’s growth
Super Micro Computer (SMCI) continues to benefit from strong demand for its servers, especially from data centers.
The company reported receiving $60 billion in new orders during its fourth quarter in fiscal year 2026. Fourth-quarter revenue jumped 91.4% year-over-year to $11.1 billion, and earnings surged 314.6% year-over-year to $1.70 per share. Analysts expected earnings of $0.96 per share on $11.56 billion in revenue, so SMCI posted a whopping 77.1% earnings surprise and a slight revenue miss.
My stock grading system rates SMCI as a C.
Cenovus Energy’s higher production powers its earnings
Cenovus Energy (CVE) is Canada’s second-largest oil and natural gas producer, as well as the second-largest refiner and upgrader in Canada.
During the second quarter, Cenovus Energy produced 970.4 thousand barrels of oil equivalent per day, up 26% year-over-year. Second-quarter earnings surged 237.2% year-over-year to $2.87 billion, or $1.53 per share. Analysts expected earnings of $1.16 per share, so Cenovus Energy posted a 31.9% earnings surprise. Total revenue rose 40.3% year-over-year to $17.4 billion.
My stock grading system rates Cenovus Energy as an A.
Kennametal’s earnings growth accelerates
Kennametal (KMT) makes high-performance tools used to cut and shape metal. It also makes metal and ceramic parts, tools and metal powders.
In fiscal year 2026, the company achieved 237.5% annual earnings growth and 20% annual revenue growth. For its first quarter in fiscal year 2027, the company expects sales between $745 million and $775 million. Adjusted earnings are expected between $2.50 and $2.80 per share. That compares with sales of $497.97 million and earnings of $0.34 per share in the first quarter of 2026.
My stock grading system rates Kennametal as an A.
For more information about my stock grading system, click here.
Related: Fund manager’s Fed interest rate outlook will frustrate consumers
