Stockchase Research
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Latest Top Picks
Stockchase Research Editor: Michael O'Reilly OGI is a cannabis producer serving the Canadian market. Recent earnings disappointed on the revenue side (down by 23%), but management is noting that adult recreational use is up 30% over the year. The company is now producing positive cash flows (in 2 of the last 3 quarters), building its cash position, and is successfully paying off debt. We would buy this with a stop-loss at $1.40, looking to achieve $3.50 -- upside potential of 55%. Yield 0% (Analysts’ price target is $3.43)
Stockchase Research Editor: Michael O'Reilly KBH is a US homebuilder. Recently reported revenues were disappointing -- down over 23% -- but sales prices were 5% higher backed by the expectation of continued low interest rates. Overall, EPS of $1.12 came in $0.18 higher than analyst expectations. The company reported orders volumes increased 50% putting order backlogs at 15 year highs. It trades at 10x earnings compared to sector averages over 34x -- making this good value here. It pays a small dividend, backed by a 13% payout ratio. We would buy this with a stop-loss at $27, looking to achieve $44 -- over 22% upside. Yield 1.71% (Analysts’ price target is $43.13)
Stockchase Research Editor: Michael O'Reilly TSN is the world's largest meat producer, selling to over 140 countries. The pandemic caused operational issues with outbreaks at its numerous facilities, but those have been virtually all resolved. It pays a great dividend, backed by a 29% payout ratio. It trades at 13x earnings, compared to a sector average of 43x, making it good value here. We would buy this with a $50 stop-loss, looking to achieve $80 -- potential upside of over 22%. Yield 2.78% (Analysts’ price target is $80.00)
(A Top Pick Nov 24/20, Up 23.1%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with INTC has achieved our $58 objective. To be disciplined, we recommend covering 50% of the position. We would also recommend trailing up the stop to $47 -- right around the initial suggested entry level.
(A Top Pick Dec 17/20, Up 24.8%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with APHA has achieved our $12.50 objective. To be disciplined, we recommend covering 50% of the position. We also recommend trailing up the stop to $8.00.
Signal
Opinion
Expert
Chart
TOP PICK
TOP PICK
November 3, 2020
Stockchase Research Editor: Michael O'Reilly SSD designs and sells wood and concrete building construction products. It has global markets including North America, Europe, Asia and Australia. Their products are directly benefiting from the home construction and DIY trends and offers global diversification. They just reported sales up 17% over the year, gross margins were 47%, and earnings were up 59%. All 1700 Lowes stores will begin carrying the company's products in Q4. It pays a small dividend backed by a 27% payout ratio. We would trade this with a stop-loss at $80, looking to target a $112 technical target -- 20% upside. Yield 1.0% (Analysts’ price target is $105.00)
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Stockchase Research Editor: Michael O'Reilly SSD designs and sells wood and concrete building construction products. It has global markets including North America, Europe, Asia and Australia. Their products are directly benefiting from the home construction and DIY trends and offers global diversification. They just reported sales up 17% over the year, gross margins were 47%, and earnings were up 59%. All 1700 Lowes stores will begin carrying the company's products in Q4. It pays a small dividend backed by a 27% payout ratio. We would trade this with a stop-loss at $80, looking to target a $112 technical target -- 20% upside. Yield 1.0% (Analysts’ price target is $105.00)
INDUSTRIAL PRODUCTS
TOP PICK
TOP PICK
November 3, 2020
Stockchase Research Editor: Michael O'Reilly JNPR is a steady producer of networking, router and cloud-computing equipment. In recent earnings its revenues were up 5% and earnings of $0.43 per share beat the market by $0.12. It trades at a forward 12 PE, a current 17 PE compared to a sector average of 21. It pays a solid dividend, backed by a 78% payout ratio. We would trade this with a $17 stop-loss, looking to achieve analyst targets near $25 -- 25% upside. Yield 4.07% (Analysts’ price target is $24.88)
Show full opinionHide full opinionStockchase Research Editor: Michael O'Reilly JNPR is a steady producer of networking, router and cloud-computing equipment. In recent earnings its revenues were up 5% and earnings of $0.43 per share beat the market by $0.12. It trades at a forward 12 PE, a current 17 PE compared to a sector average of 21. It pays a solid dividend, backed by a 78% payout ratio. We would trade this with a $17 stop-loss, looking to achieve analyst targets near $25 -- 25% upside. Yield 4.07% (Analysts’ price target is $24.88)
electrical/electronic
TOP PICK
TOP PICK
November 3, 2020
Stockchase Research Editor: Michael O'Reilly AMGN just released earnings and the 12% increase in revenues and 5% increase in EPS were likely held back due to government mandates to focus health spending towards COVID-19 projects. The company is now benefitting from the release of new arthritis and metastatic colorectal cancer treatments. They also signed a deal to partner with Eli Lilly to manufacture a coronavirus antibody treatment, when it is ready. They pay a good dividend, backed by a 50% payout ratio. We would trade this with a stop-loss of $205 and a target of of $255 -- over 15% upside. Yield 2.91% (Analysts’ price target is $254.12)
Stockchase Research Editor: Michael O'Reilly AMGN just released earnings and the 12% increase in revenues and 5% increase in EPS were likely held back due to government mandates to focus health spending towards COVID-19 projects. The company is now benefitting from the release of new arthritis and metastatic colorectal cancer treatments. They also signed a deal to partner with Eli Lilly to manufacture a coronavirus antibody treatment, when it is ready. They pay a good dividend, backed by a 50% payout ratio. We would trade this with a stop-loss of $205 and a target of of $255 -- over 15% upside. Yield 2.91% (Analysts’ price target is $254.12)
biotechnology/pharmaceutical
PAST TOP PICK
PAST TOP PICK
November 3, 2020
(A Top Pick Aug 25/20, Up 28.1%)Stockchase Research Editor: Michael O'Reilly We are recommending raising the stop-loss on FL to $30 (previously at $26.50). We continue to target $44 on the upside as the next objective.
Show full opinionHide full opinion(A Top Pick Aug 25/20, Up 28.1%)Stockchase Research Editor: Michael O'Reilly We are recommending raising the stop-loss on FL to $30 (previously at $26.50). We continue to target $44 on the upside as the next objective.
clothing stores
TOP PICK
TOP PICK
October 29, 2020
Stockchase Research Editor: Michael O'Reilly NCR is a global leading point-of-sale and ATM software provider. Following recent earnings, it is trading at a PE of 6. With expectations of over 40% growth in EPS next year, this TOP PICK is good value. No doubt retail vendors have been impacted by the pandemic, however, the need for contact-less payment systems will only grow. Analysts at JP Morgan just upgraded the stock to overweight with a $27 target. We would trade this with a $18 stop-loss, looking to hit analyst targets -- over 30% upside. Yield 0% (Analysts’ price target is $27.00)
Stockchase Research Editor: Michael O'Reilly NCR is a global leading point-of-sale and ATM software provider. Following recent earnings, it is trading at a PE of 6. With expectations of over 40% growth in EPS next year, this TOP PICK is good value. No doubt retail vendors have been impacted by the pandemic, however, the need for contact-less payment systems will only grow. Analysts at JP Morgan just upgraded the stock to overweight with a $27 target. We would trade this with a $18 stop-loss, looking to hit analyst targets -- over 30% upside. Yield 0% (Analysts’ price target is $27.00)
Business Services
TOP PICK
TOP PICK
October 29, 2020
Stockchase Research Editor: Michael O'Reilly MS is one of the world's largest investment banking, securities and wealth management companies. Recently reported revenues were up 16% over the year and earnings increased by 25%. Trading with an 8 PE, it is good value here. It pays a solid dividend, backed by a payout ratio of only 28% of cash flow. We would trade this with a $35 stop-loss, looking to hit analysts targets near $60 -- 25% upside. Yield 2.94% (Analysts’ price target is $59.63)
Show full opinionHide full opinionStockchase Research Editor: Michael O'Reilly MS is one of the world's largest investment banking, securities and wealth management companies. Recently reported revenues were up 16% over the year and earnings increased by 25%. Trading with an 8 PE, it is good value here. It pays a solid dividend, backed by a payout ratio of only 28% of cash flow. We would trade this with a $35 stop-loss, looking to hit analysts targets near $60 -- 25% upside. Yield 2.94% (Analysts’ price target is $59.63)
investment companies/funds
TOP PICK
TOP PICK
October 29, 2020
Stockchase Research Editor: Michael O'Reilly The pandemic has created great opportunity for regional food stores. WMK is a lesser known chain operating 197 stores in the US Mid-Atlantic that is putting out good numbers and has a solid dividend backed by a 33% payout ratio of cash flow. Recently reported EPS doubled over the year, with comparable same-store sales up 24% while ecommerce sales grew over 240%. We would trade this with a stop-loss at $38, looking to re-visit recent highs near $56 -- 25% upside. Yield 2.71%
Show full opinionHide full opinionStockchase Research Editor: Michael O'Reilly The pandemic has created great opportunity for regional food stores. WMK is a lesser known chain operating 197 stores in the US Mid-Atlantic that is putting out good numbers and has a solid dividend backed by a 33% payout ratio of cash flow. Recently reported EPS doubled over the year, with comparable same-store sales up 24% while ecommerce sales grew over 240%. We would trade this with a stop-loss at $38, looking to re-visit recent highs near $56 -- 25% upside. Yield 2.71%
food stores
PAST TOP PICK
PAST TOP PICK
October 29, 2020
(A Top Pick Oct 13/20, Down 15.2%)Stockchase Research Editor: Michael O'Reilly We are recommending covering RKT as we have violated the stop-loss set at $20. We are choosing to keep our powder dry for other opportunities.
Show full opinionHide full opinion(A Top Pick Oct 13/20, Down 15.2%)Stockchase Research Editor: Michael O'Reilly We are recommending covering RKT as we have violated the stop-loss set at $20. We are choosing to keep our powder dry for other opportunities.
Financial Services
PAST TOP PICK
PAST TOP PICK
October 29, 2020
(A Top Pick Sep 29/20, Down 5.9%)Stockchase Research Editor: Michael O'Reilly We are recommending to cover MRK as it has violated our stop-loss. We are going to look for better opportunities.
Show full opinionHide full opinion(A Top Pick Sep 29/20, Down 5.9%)Stockchase Research Editor: Michael O'Reilly We are recommending to cover MRK as it has violated our stop-loss. We are going to look for better opportunities.
biotechnology/pharmaceutical
PAST TOP PICK
PAST TOP PICK
October 29, 2020
(A Top Pick Aug 04/20, Down 7.7%)Stockchase Research Editor: Michael O'Reilly We are recommending to cover MCK as it has violated our stop-loss. We are being disciplined and will look for better opportunties.
Show full opinionHide full opinion(A Top Pick Aug 04/20, Down 7.7%)Stockchase Research Editor: Michael O'Reilly We are recommending to cover MCK as it has violated our stop-loss. We are being disciplined and will look for better opportunties.
wholesale distributors
PAST TOP PICK
PAST TOP PICK
October 29, 2020
(A Top Pick Oct 22/20, Down 11.7%)Stockchase Research Editor: Michael O'Reilly We are recommending the exit of NOK as it has breached our recommended stop-loss at $3.75. The company just reported earnings that missed on both the top and bottom lines and reduced its balance of 2020 guidance by 10%. We are going to be disciplined and look for better opportunities.
Show full opinionHide full opinion(A Top Pick Oct 22/20, Down 11.7%)Stockchase Research Editor: Michael O'Reilly We are recommending the exit of NOK as it has breached our recommended stop-loss at $3.75. The company just reported earnings that missed on both the top and bottom lines and reduced its balance of 2020 guidance by 10%. We are going to be disciplined and look for better opportunities.
Telecommunications
PAST TOP PICK
PAST TOP PICK
October 29, 2020
(A Top Pick Aug 25/20, Up 75%)Stockchase Research Editor: Michael O'Reilly As we have hit our $28 objective, we are recommending to take profit on half of holding in FLXS. This secures a 75% gain on half the position. We recommend raising the trailing stop to $24.00.
Show full opinionHide full opinion(A Top Pick Aug 25/20, Up 75%)Stockchase Research Editor: Michael O'Reilly As we have hit our $28 objective, we are recommending to take profit on half of holding in FLXS. This secures a 75% gain on half the position. We recommend raising the trailing stop to $24.00.
Consumer Products
TOP PICK
TOP PICK
October 27, 2020
Stockchase Research Editor: Michael O'Reilly AT&T recently reported earnings and the benefits of the company's diversified strategy are showing through. The company is involved in communication infrastructure, cinema, and now streaming services. The yield it pays is large, but we think cash flow has to grow a bit to ensure its sustainability. Although its movie releases under Warner Bros saw revenue declines, that was made up for by its HBO streaming services. The company plans to sell off $10 billion in assets this year to further sharpen its focus. We would trade this with a $24 stop-loss, looking for an upside target to $34 -- over 25% upside. Yield 7.60% (Analysts’ price target is $33.60)
Show full opinionHide full opinionStockchase Research Editor: Michael O'Reilly AT&T recently reported earnings and the benefits of the company's diversified strategy are showing through. The company is involved in communication infrastructure, cinema, and now streaming services. The yield it pays is large, but we think cash flow has to grow a bit to ensure its sustainability. Although its movie releases under Warner Bros saw revenue declines, that was made up for by its HBO streaming services. The company plans to sell off $10 billion in assets this year to further sharpen its focus. We would trade this with a $24 stop-loss, looking for an upside target to $34 -- over 25% upside. Yield 7.60% (Analysts’ price target is $33.60)
Telecommunications
BUY WEAKNESS
BUY WEAKNESS
October 27, 2020
Stockchase Research Editor: Michael O'Reilly DPZ missed its last earnings target due to temporary increases in supply costs for labour and food resulting from the pandemic. However, the drivers that pushed to stock to previous highs still exists. As the next wave of the pandemic sets in, you can bet sales will benefit as people choose order out. We would buy this on weakness near $345. Yield 0.79% (Analysts’ price target is $435.40)
Show full opinionHide full opinionStockchase Research Editor: Michael O'Reilly DPZ missed its last earnings target due to temporary increases in supply costs for labour and food resulting from the pandemic. However, the drivers that pushed to stock to previous highs still exists. As the next wave of the pandemic sets in, you can bet sales will benefit as people choose order out. We would buy this on weakness near $345. Yield 0.79% (Analysts’ price target is $435.40)
food services
TOP PICK
TOP PICK
October 27, 2020
Stockchase Research Editor: Michael O'Reilly This solid dividend player is trading at a great PE valuation following its most recent earnings report. Earnings reflected a 10% drop in revenues from a year ago, as HDD was weaker than expected, but was partially offset by its cloud data center demand and video applications. The company stands by its guidance numbers, whose mid-points are above current analyst expectations. Trading at a 10 PE it is great value compared to the sector average PE of 63. It pays a great dividend backed by a 38% payout ratio. We would trade this with a $42 stop-loss, looking for a technical target of $60 -- almost 25% upside. Yield 5.47% (Analysts’ price target is $53.41)
Show full opinionHide full opinionStockchase Research Editor: Michael O'Reilly This solid dividend player is trading at a great PE valuation following its most recent earnings report. Earnings reflected a 10% drop in revenues from a year ago, as HDD was weaker than expected, but was partially offset by its cloud data center demand and video applications. The company stands by its guidance numbers, whose mid-points are above current analyst expectations. Trading at a 10 PE it is great value compared to the sector average PE of 63. It pays a great dividend backed by a 38% payout ratio. We would trade this with a $42 stop-loss, looking for a technical target of $60 -- almost 25% upside. Yield 5.47% (Analysts’ price target is $53.41)
computer software/processing
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