The best stocks to watch offer telltale clues as they prepare to launch breakout moves. The key is to identify these clues while managing risk. Here’s a look at 19 top stocks setting up buy points or buy zones, including Microsoft (MSFT), STMicroelectronics (STM), Cadence design systems (CDNS), Palo Alto Networks (PANW) And Texas Roadhouse (TXRH).
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house builder Meritage houses (MTH), PulteGroup (PHM), lennar (LEN), Tri Pointe Homes (TPH) And Taylor Morrison (TMHC) also do this inventory screen.
Hershey (HSY), Academy Sport & Outdoor (ASO), copart (CPRT) And SciPlay (SCPL) have also found a sweet spot on the list.
To create this screen, each of these stocks to watch must meet the following criteria:
- Composite rating of at least 90.
- EPS rating of at least 80.
- RS rating of at least 80.
- Accumulation/distribution rating A, B or C.
- Price vs. 21-day moving average at least 1%-5%.
- RS line within 5% of new high.
- Price vs. 50-day moving average at least 10%.
- 10-day line above 21-day line, which must be above 50-day line.
- Current price at least $12.
- Average daily volume over 400,000 shares.
| Pursue | symbol | Comp Rating | EPS rating | RS rating | SMR rating | A/D evaluation |
|---|---|---|---|---|---|---|
| Meritage houses | (MTH) | 99 | 97 | 96 | A | B- |
| Palo Alto Networks | (PANW) | 99 | 97 | 91 | A | A- |
| Cadence design systems | (CDNS) | 98 | 97 | 93 | A | B+ |
| PulteGroup | (PHM) | 98 | 99 | 95 | A | C |
| STMicroelectronics | (STM) | 98 | 98 | 95 | A | C |
| Tri Pointe Homes | (TPH) | 98 | 97 | 95 | B | B |
| SciPlay | (SCPL) | 97 | 93 | 92 | B | B |
| copart | (CPRT) | 96 | 90 | 92 | A | B+ |
| lennar | (LEN) | 96 | 87 | 92 | B | B- |
| Taylor Morrison house | (TMHC) | 96 | 98 | 95 | B | C |
| Texas Roadhouse | (TXRH) | 96 | 84 | 92 | A | B+ |
| wing stop | (WING) | 96 | 98 | 98 | – | B- |
| CBOE Global Markets | (CBOE) | 95 | 86 | 84 | A | B+ |
| Hershey | (HSY) | 95 | 88 | 86 | A | A |
| Microsoft | (MSFT) | 94 | 85 | 83 | A | A- |
| bruker | (BRKR) | 92 | 89 | 92 | B | C |
| Academy Sport & Outdoor | (ASO) | 91 | 93 | 96 | C | B- |
| Thomson Reuters | (TRI) | 91 | 98 | 90 | C | B- |
| Takeda Pharma | (TAK) | 90 | 89 | 87 | C | B- |
Data as of March 29, 2023
MSFT among stocks to watch in or near a buy zone
While not a buy recommendation, the above screen highlights MSFT stock, PANW stock, and other companies that are showing both fundamental and technical strength.
However, given the current market correction, buying stocks in this environment is risky. The chances of a successful and sustained breakout are much better in a strong uptrend.
Some of these leading stocks to watch are also featured on IBD stock lists for their strength in key stock ratings and metrics.
With their track records of stable earnings growth and continued relative strength, CDNS and MSFT shares deserve placement on IBD Long-Term Leaders. CDNS shares also land on the spot IBD Big Cap 20.
The IBD 50 has a ton of names on this screen including Cadence, PulteGroup, Meritage Homes, Tri Pointe and Copart.
Follow Matthew Galgani on Twitter at @IBD_MGalgani.
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Source : www.investors.com