Close, But No 'Perfect' Cigar For Nvidia, Broadcom. But Kudos To These 22 Gems.

After getting tarnished in a volatile July, Nvidia (NVDA) got its mojo back to earn the highest-possible 99 Composite Rating alongside fellow artificial intelligence leader Broadcom (AVGO). But Nvidia stock and Broadcom fail to make this screen of companies earning "perfect" status due to missing on this metric: group ranking.

To zero in on top-rated stocks in top-ranked industries, this stock screener highlights 22 companies with a 99 Composite Rating that also rank among the Top 20 industry groups. A slew of mining stocks, as well as GE Aerospace (GE) and language-learning platform Duolingo (DUOL), fit that bill.

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Miners Polish List Of 'Perfect' Gems

Nvidia and Broadcom miss making the list because both hail from the fabless semiconductor industry, which ranks outside the Top 20 at a still-solid No. 37.

But driven by demand for precious metals, miners like Alamos Gold (AGI), Eldorado Gold (EGO), Iamgold (IAG) and Idaho Strategic Resources (IDR) have forged a strong presence on this screen. They are joined by Agnico-Eagle Mines (AEM), Newmont (NEM), Silvercorp Metals (SVM), Fortuna Mining (FSM) and Triple Flag Precious Metals (TFPM).

Two medical sector stocks — Universal Health (UHS) and Pennant (PNTG) — also find a spot on this list.

In addition to GE stock, the stock screener flagged aerospace and defense stocks Heico (HEI), Howmet Aerospace (HWM) and M-tron Industries (MPTI).

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Top Stocks In Top Groups

All the names on this stock screen hail from the top-ranked industry groups — a factor worth noting because winning stocks tend to come from the top-ranked groups among the 197 industries that IBD tracks. This screen highlights the Top 20 industries.

For example, driven by gold prices, the Mining-Gold/Silver/Gems group ranks a lofty No. 10 among the 197 groups IBD tracks, according to MarketSurge. GE stock's Aerospace/Defense group ranks No. 18.

Stock Screener Highlights Top-Rated Industry Leaders

Data as of Sept. 26

Miners Among Best Stocks To Watch

To make this screen of top stocks to watch in the top-ranked industries, each company must meet the following criteria:

• Industry group rank: from 1 to 20 (on IBD's 197 industries list).
• Composite Rating: 99.
• EPS Rating: 80 or higher.
• Relative Strength Rating: 80 or higher.
• SMR Rating: A or B.
• Current share price: $12 or more.
• 50-day daily average volume: 400,000 shares or more.

However, ratings of course are just one part of the equation when evaluating a stock. Be sure to always check the stock chart to gauge when to buy, sell or hold.

Stock Screener: Build Your Watchlist With Stock Ratings And Stock Lists

Running stock screens with the IBD Stock Screener or MarketSurge is an effective way to streamline your research to find top-rated stocks to watch.

You can also zero in on the best stocks to watch using IBD stocks lists based on a wide range of preset filters. You'll find top-rated stocks meeting the criteria of the IBD 50, IBD Sector Leaders, IBD Big Cap 20, IPO Leaders and more.

Once you've put together potential stock picks for your watchlist, you'll want to evaluate your ideas with IBD Stock Checkup. With pass, neutral or fail ratings for each of your stocks, IBD Stock Checkup provides a detailed look at both the fundamental and technical health of the companies on your watchlist.

Additionally, based on The IBD Methodology, the Composite Rating provides an overall score that takes into account each of the IBD ratings. The single score considers how a company and its stock are performing in terms of annual and quarterly earnings growth as well as its relative strength vs. the rest of the market. The score also accounts for sales, profit margins and institutional demand.

However, note that you should not buy a stock solely on its ratings or placement on one of IBD's stock lists. No matter how compelling a company's story may seem, savvy investors will always check the technical action in the stock chart before buying.

Check The Chart To Know When To Buy Stocks

Using stock lists helps you zero in on the best stocks to watch. Stock ratings look under the hood to diagnose a company and its stock's fundamental and technical health. Both stock lists and stock ratings help you understand what to buy. But to fully understand when to buy stocks, take a look at the stock chart.

Meanwhile, it's also critical to understand what type of environment you're currently in. Is it a bull market, when most stocks go up? Or a bear market, when most stocks go down? Or is it a volatile, choppy and uncertain time when the market indexes tend to fail to make any sustained headway?

Use stock charts to evaluate both the market indexes and individual stocks. Charts will help you pinpoint the best time to buy stocks by identifying support and resistance, as well as buy points and buy zones. Using charts also helps you identify warning signs and when to sell stocks.

So when searching for potential stock picks and stocks to watch, always check the charts. They provide the most unbiased diagnosis of a stock's health.

Follow Matthew Galgani on Twitter at @IBD_MGalgani.

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