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6 Stocks that Stand Out in Today's Sizzling Stock Market

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By The Associated Press

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Richard Drew/AP

By ALEX VEIGA

LOS ANGELES — It’s summertime and the stock market is sizzling. The market reached an all-time high last week, torching its previous record set just before Memorial Day.

Even so, a handful of companies stand out. Six stocks — Amazon, Starbucks, UnitedHealth, Visa, Mastercard, and Discover Financial — notched their own records last week, helped by the growing confidence of American consumers.

Would buying these stocks now be a hot-weather impulse or a coldly calculated move?

All six have improving earnings outlooks, analysts say. Credit-card companies and UnitedHealth appear to be the best bets.

The six companies share similar traits that make them attractive. They are consumer-focused, with dominant market positions and growing revenue streams, says Fred Dickson, chief investment strategist at D.A. Davidson & Co.

Their importance to shoppers is crucial to their growth prospects. Americans’ confidence in the economy has reached its highest point in 5½ years. The housing recovery is strengthening. Job growth continues at a steady pace.

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When consumers feel better about the economy, they splurge on discretionary items like a Venti Caramel Macchiato from Starbucks or a new book or DVD from Amazon. And they pay for those items with credit cards.

Visa and UnitedHealth are the most attractive buys right now, says David Brown, chief market strategist at Sabrient Systems, an investment research firm.

The outlook for Discover and MasterCard is also good, particularly as consumer confidence improves. The companies’ biggest challenge remains staying competitive in a crowded field, he says.

While Brown expects Amazon to continue to dominate its market, he sees a big risk in buying the stock now.

“It’s a fine company, but I would want to enter it in a pullback — a big pullback,” Brown says. “It has, by far, the most downside.”

Here’s a brief summary of each stock:

UnitedHealth Group Inc. (UNH)

The stock of the nation’s largest health insurer has climbed more than 25 percent this year and hit an all-time high of $68.75 in trading Wednesday, according to FactSet.

Like other health insurers, UnitedHealth stands to benefit from the federal health care overhaul. The company will be able to participate in state-based health insurance exchanges designed to expand coverage to millions of uninsured Americans. The company is also the largest provider of Medicare Advantage plans, which are privately run versions of the government’s Medicare program for the elderly and disabled people.

Financial analysts, on average, expect the stock to move higher. Their consensus target price is $71.47, according to FactSet.

On average, the stock has a “Buy” rating from analysts polled by FactSet.

Amazon.com Inc. (AMZN)

Amazon’s stock price is up about 23 percent this year and touched an all-time high …read more

Source: FULL ARTICLE at DailyFinance

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Stocks Rise for Fourth Day in a Row, Led by Retail

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By The Associated Press

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By MATTHEW CRAFT

NEW YORK (AP) – Rite Aid (RAD), Ross Stores (ROST) and other retailers surged Thursday after turning in better sales, and major stock market indexes rose for a fourth day straight.

The discount chain Ross Stores jumped 6 percent, the best gain in the Standard & Poor’s 500 index. The company said stronger sales in March will likely push profits above its previous estimate this quarter. The stock jumped $3.56 to $63.80.

A surprising drop in claims for unemployment benefits last week gave investors more encouragement. Analysts said it could mean a slowdown in hiring last month may have been temporary.

“The numbers today make it seem like that March report was an anomaly,” said David Heidl, a regional investment manager at U.S. Bank’s wealth management unit. “It’s another reason for optimism.”

The Dow Jones industrial average gained 62.90 points to close at 14,865.14, an increase of 0.4 percent. The Standard & Poor’s 500 index rose 5.64 points, also 0.4 percent, to 1,593.37.

Rite Aid soared 18 percent to $2.12 after the drugstore chain said higher sales of generic drugs and lower costs helped it post better earnings than analysts had expected.

Makers of computer hardware and software sank following a report that first-quarter shipments of PCs dropped 14 percent worldwide over the past year. That’s the steepest fall since International Data Corp. started tracking the industry in 1994.

“The IDC report is much worse than anyone expected,” said David Brown, director of Sabrient Systems, an investment research firm. “That’s obviously shaking up the tech sector, but everything else is resuming the climb.”

The three companies in the Dow that deal in PCs held the index back. Hewlett-Packard (HPQ) dropped 6 percent to $20.88, Microsoft (MSFT) lost 4 percent to $28.93 and Intel fell 2 percent to $21.82. Without them, the Dow would have gained 25 more points.

The tech-heavy Nasdaq composite index rose 2.90 points to 3,300.16. That’s just 0.09 percent, far behind the Dow and S&P 500. Of the 10 industry groups in the S&P 500, information technology was the only one to fall.

It was a different story on Wednesday, when technology stocks surged on optimism that businesses would step up spending on computer systems. That pushed the Dow and the S&P 500 index to their third straight day of gains as well as record highs.

The stock market has soared this year, clearing record highs and recovering losses from the financial crisis and Great Recession. For the year, the Dow is up 13 percent, the S&P 500 index 12 percent.

Brown thinks the market can keep climbing. Measured against earnings, the stock market doesn’t look expensive, he said. And compared to the alternatives, like bonds or money-market funds, stocks in many big corporations offer a better source of income. The average stock in the

From: http://www.dailyfinance.com/2013/04/11/stocks-rise-for-fourth-day-in-a-row-led-by-retail/

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Stocks Close Even Higher Following Dow's Record Day

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By The Associated Press

U.S. futures head higher; Dow set to extend record

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By MATTHEW CRAFT

NEW YORK — After barreling through a record the day before, the Dow Jones industrial average meandered higher on Wednesday.

The Dow edged up 42.47 points, or 0.3 percent, to close at 14,296.24. An encouraging job-market report helped nudge the stock market up and pushed bond prices lower.

On Tuesday, the Dow blew past the previous all-time high it hit more than five years ago. The index of 30 big corporations has more than doubled since hitting a low during the financial crisis in March 2009.

The question now is, how much longer can it keep climbing?

In the past, stock indexes have often drifted lower in the months after breaking through record highs. David Brown, director of Sabrient Systems, an investment research firm, sees plenty of reasons for the market to keep climbing, however. People are putting their cash into the stock market again. And the alternatives, like bonds, are hardly appealing.

“There is literally nowhere else to go,” Brown said. “Do you really want to make 1.9 percent on a 10-year Treasury? You won’t make any money doing that.”

In other trading, the Standard & Poor’s 500 index rose 1.67 points, or 0.1 percent, to 1,541.46. The Nasdaq slipped 1.77, less than 0.1 percent, to 3,222.36.

Microsoft (MSFT) led a decline in tech stocks, losing 26 cents to $28.09. European regulators fined the company for breaking an antitrust agreement requiring the software giant to offer computer users a choice of Internet browsers, instead of just Internet Explorer.

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Companies added 198,000 U.S. workers to their payrolls in February, according to payment processor ADP. The firm also said employers added 23,000 more jobs in January than first reported.

The ADP survey suggests that government spending cuts have yet to deter employers from hiring. Investors look to the ADP survey as a preview to the closely watched Labor Department report, which comes out Friday. Economists expect the government to say employers added 152,000 jobs in February, lowering the unemployment rate to 7.8 percent from 7.9 percent.

As traders anticipated better news about the job market, bond prices fell and the yield on the 10-year Treasury rose to 1.93 percent from 1.90 percent late Tuesday.

Expectations of a stronger economy tend to lure traders out of Treasurys and into investments that tend to rise with economic growth, like stocks.

Over the long haul, stock markets head higher, but the path is rarely smooth. In October 2007, the Dow hit its previous high of 14,164. A year later, the country was in the middle of a financial crisis and the Dow was in free fall. In January 1987, the Dow closed above 2,000 for the first time, then hit a record of 2,722 in August. Two months later, the Dow had plunged 36 percent from its peak, including …read more
Source: FULL ARTICLE at DailyFinance