Ah yes, even in a choppy market, some stocks are breaking out. They are to be congratulated and some even bought, for if they can break out to new highs with all this negativity surrounding them, imagine how they’ll perform if and when the market outlook brightens.
InterContinental Exchange, Inc. (ICE), the $12.2 billion electronic commodity market broke out to a new all-time high at $175.48. Over the past year, the stock had tried to break $170 twice and failed to hold…will the third time be the charm? Earnings estimates have been on the rise so so earnings today are key. Last time the stock had a solid breakout in the $85 range, it doubled within 4 months…
Lawson Software, Inc. (LWSN), the $1.9 billion provider of business application software, also just broke out to a 3-year high, although not an all-time high at $10.69. Quarterly and annual revenue growth clocks in at a boring 9% so with a forward PE of 20, this looks expensive. But, you gotta respect the technical breakout!
Pharmaceutical Product Development Inc. (PPDI), a $4.8 billion provider of contract drug-development research, broke out of a 2-year base to make an all-time high at $40.47. This latest price surge was after earnings—a great sign that the numbers inspired many buyers—where quarterly revenues rose 14% to $357 million, beating estimates of $344. Head’s up: Last time this stock broke out to new highs at $20 in late 2004, it doubled within the next year. But now forward PE is already 24 so they gotta up their growth is they want to up their stock.
Parker Hannfin (PH), a $13.7 billion motion control systems for the industrial and aerospace markets, made a new all-time high at $78.61. Earnings estimates, like their stock price, have been on fire, but with a forward PE of 14 and only 7% revenue growth, it looks fully valued here. But, if you’re like me and you choose technicals over fundamentals, let the good times roll!
Grupo Aeroportuario Del Sureste SA de CV (ASR), a $1.7 billion Mexican airport operator with too many letters in their company name, made a new all-time high at $57.22, continuing it’s nearly 500% runup over the past few years. They just announced September traffic was up nearly 14% over 2006, right in line with their overall revenue growth, but under performing since the stock trades with a forward PE of 21. No matter, Viva la Chart!
Intricon Corp. (IIN), a $68 million designer, developer, manufacturer and distributor of body-worn medical and electronics devices, broke out to multi-year highs to close at $12. Strong earnings seemed to be the cause as quarterly revenues surged 48% to $18.4 million and they even managed to make a few hundred grand (apparently it’s a tough business!) The stock has tripled this year and it’s approaching all-time highs in the $13 area so I’d wait for it to prove it can break out to an all-time high before buying.
AuthenTec, Inc. (AUTH), a $383 million provider of fingerprint sensors and solutions, has only been publicly traded for a few months, but broke out to a new high at $14.70 before finishing down slightly at $14.37. I wrote an article for TheStreet.com about how hot sensor technologies are and this play is no different. It’s early in the game, but if it can breach $15, I’m buying.
Disclosure: Timothy Sykes has no positions
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