by Marc Bastow | April 2, 2012 8:00 am
It doesn’t seem that long ago — but really, it’s been a full three months — since InvestorPlace analyst Daniel Putnam[1] gave us his thoughts about the Best Breakout Bets for Q1 2012[2]. He looked at a number of stocks that were near 52-week highs and had potential to break to the upside if the market strengthened.
And boy, did it get strong. Take a look at the performance of the three prominent benchmarks during the first quarter of 2012:
Needless to say, more than a few stocks headed north. So now, let’s take a look at the top five performances from Putnam’s list of stocks poised to break out:
William Shatner made the right decision to become a spokesman for online travel and leisure giant Priceline (NASDAQ:PCLN[3]), who led the way with a whopping 53% first-quarter gain. Revenue growth is fueling the PCLN shares, and analysts expect a bang-up first quarter on the heels of last year’s Q4 results, which showed a 36% year-over-year increase. PCLN is well-positioned for a continuation in the trend, as their investments in Booking.com and Agora.com are paying dividends in the respective growing European and Asian online travel markets.
Not only is Rackspace (NASDAQ:RAX[4]) playing in the cloud, but its stock price is way up in the air too, finishing Q1 up 34%. RAX operates in the hosting and cloud computing industry, offering its products under the Fanatical Support brand. The company’s Open Stack platform model draws rave reviews from analysts and customers, and analysts believe the company is gaining in the all-important enterprise market space, according to Investors.com[5]. With the cloud computing model all the rage and most decidedly the future, the Houston-based company has the potential to keep rising.
Las Vegas Sands (NYSE:LVS[6]), the leading global developer of destination properties and resorts, doubled down on its bets and came out with a 33% first-quarter gain. Chairman and Chief Executive Sheldon Adelson is not just spending his time helping out with the Newt Gingrich campaign — the company is busy opening the new Sands Cotai Central[7] in Macau, too. Meanwhile, the entertainment empire is forecast to grow earnings per share to $2.57 in 2012 — up from 2011’s $2.06, and 98 cents in 2010. The stock price has more than doubled over the past 12 months. Like Las Vegas itself, LVS keeps getting bigger and better.
March Madness descended on the nation in March, and Foot Locker (NYSE:FL[8]) was one of the prime beneficiaries,[9] riding the wave to a 30% Q1 gain. The company operates in two segments — stores and direct-to-customer sales — and sells footwear and apparel through its 3,402 stores worldwide. It has all added up to a whopping $5.62 billion in merchandise in 2012, and year-over-year increases in earnings and revenues over the past three years. A mild spring in the Northeast helped out retailers selling sports gear and equipment, and with spring in gear and summer on the way, FL should continue to benefit from consumers getting out and playing.
The ever-expanding chain of Mexican burrito restaurants is the “laggard” of our group, but when your stock is up 24% in three months, you have nothing to complain about. In fact, Chipotle (NYSE:CMG[10]) has climbed almost tenfold during the past three years, and claims a market value of just north of $13 billion. CMG expects to open another 160 restaurants during the course of 2012, so it appears growth will continue onward, with last year’s $2.3 billion in sales left in the dust. CMG isn’t without some detractors[11], but for now it is one of the big breakout stories of 2012.
Marc Bastow is an Assistant Editor of InvestorPlace. As of this writing, he did not hold a position in any of the aforementioned securities.
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