This year, the stock market has had a decent run with S&P 500 up by 18%. At the moment, it is about 10% higher than its moving average (of 200 days) which is good, but not excessive. As the stock market enters August, there are two important things to consider.
Firstly, S&P 500’s history in August has been one of gain. Secondly, it is also a month of volatility in terms of returns. Based upon this trend, investors should aim at companies that have a technical backdrop. These companies will see their earnings estimate rise in the coming month.
But good investors do their own research, find their own diamonds in the rough. You’ve got to put the work in, advises 1Wealth Trading. Find out as much as you possibly can about a company before investing in it.
Three investment ideas have been summarized here in order to lessen the worry of investors:
Hawaiian Holdings (HA)
Many people are skeptical about investing in airlines. However Hawaiian Holdings has seen a sharp rise in recent months with the trend expected to continue till 2014. Last week’s report indicates a 7 cent increase to $0.88.
The 2014 estimate has now risen to $1.16. The market cap is at a solid 398.49M. The stock has already moved up by 19.4% during the last four weeks. The 50 day moving average for HA suggests a short term bullish trend.
Marvel Technology (MRVL)
While the semi-conductor industry had seen a phase of decline, MRVL is now enjoying a stable period. In technical terms, the stock is currently trading cheap with comparison to its book value.
The book value currently is 2.7x while its median has been 6.9x. Therefore, it is currently inexpensive with the long term valuation range. Starting from 2012, the stock has established an uptrend. Recent market activity suggests a further price strength.
So there’s a trend line in 2012 where the stock was declining, then it stabilized to show resistance. Now a push to a higher cycle is expected that’s definitely going to reward the stakeholders.
The market cap is currently at 6.61B and the stocks have seen a 2.85% increase this week. The overall volume has risen 4.9 times. The shares have also hit an annual high of $12.48.
CME Group (CME)
The CME stock can be defined by high profile futures, options and swap exchange. The estimates for 2013 are on the rise and would move to $3.24. For 2014, the rate is estimated to rise to $3.73.
One thing that would help CME is the trading activity that’s linked with the potential for the Fed. The market cap is currently at the rate of 24.81B.
The company shares have increased 50% this year without any price appreciation. It is also important to note that the expectations from Wall Street have also risen for CME. The revenues are expected to increase by 1% and the earnings to be comparatively better than the last year.
The earning season is now coming to a close, and it is important to choose winners wisely. Technical stocks like the ones mentioned above are derived from a series of trends this year.
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