3 Year-to-Date Doublers to Double Down On

by Dan Burrows | September 23, 2013 6:30 am

3 Year-to-Date Doublers to Double Down On

6SmallCapsWith10yield 3 Year to Date Doublers to Double Down On[1]Yes, we all know that when it comes to investing, the rule is to buy low and sell high. But for a fast score in trading, often the key is to buy high and sell higher.

Just because a stock has doubled or even tripled in a short period of time (and maybe looks ridiculously overpriced, too) doesn’t mean it can’t keep going higher — especially in the short-term.

November through January is historically the strongest three-month stretch for stocks. The taper is off the table and risk is back on. At this point, barring a bad-news surprise, plenty of stocks with loads of momentum look ready to rally through to year’s end.

No, you wouldn’t construct a long-term value portfolio this way. But sometimes hot stocks are hot stocks — fundamentals or valuation be damned.

Here are three stocks that have doubled, tripled and even quintupled for the year-to-date — and could close out the year with even more gains.

LinkedIn

LinkedIn185 3 Year to Date Doublers to Double Down On[2]YTD Performance: +114%

LinkedIn (LNKD[3]) has become the dominant social destination for business, with a more than 225 million acquired users around the world. That gives it a wide moat, meaning investors can have some confidence that it won’t go the way of Friendster or MySpace.

Shares have more than doubled for the year-to-date, but then, LinkedIn hasn’t exactly been short of bullish catalysts. The company keeps beating Wall Street estimates — usually by a wide margin — and it recently lowered its sign-up age to 18, which should help bring even more users into the fold.

Technicals also point to more upside in the short term. LNKD trades well above its 50- and 200-day moving averages, and scores a 9 out of 10 on price momentum — a proprietary formula that takes into account a stock’s relative strength and seasonality — according to Thomson Reuters Stock Reports.

Netflix

Netflix 3 Year to Date Doublers to Double Down On[4]YTD Performance: +240%

True, as we noted recently, the last time Netflix (NFLX[5]) stock went on this kind of tear, it crashed and burned in an epic meltdown[6]. But that doesn’t mean NFLX has flown too close to the sun just yet.

For one thing, Netflix is dominant in its industry, profitable — and growing rapidly. Wall Street expects earnings per share to quintuple this year — to $1.49 from 29 cents a year ago. EPS is projected to more than double in 2014.

NFLX also has technicals on its side, scoring a 10 out of 10 for price momentum, according to Thomson Reuters Stock Reports.

Tesla Motors

Tesla185 3 Year to Date Doublers to Double Down On[7]YTD Performance: +440%

Shares in Elon Musk’s revolutionary electric car company Tesla Motors (TSLA[8]) have gone parabolic lately, putting the hurt on short sellers, many of whom have yet to be squeezed out.

With more than a third of the float sold short, short covering could continue to fuel the TSLA rally for some time. And, of course, there’s the allure of a great “story” stock, a visionary CEO[9] and the effect of folks chasing returns on TSLA also helping out.

Lastly, the technicals are bullish. Tesla scores a 10 out of 10 for price momentum, according to Thomson Reuters Stock Reports data.

As of this writing, Dan Burrows did not hold a position in any of the aforementioned securities.

Endnotes:
  1. [Image]: http://investorplace.com/wp-content/uploads/2010/11/6SmallCapsWith10yield.jpg
  2. [Image]: http://investorplace.com/wp-content/uploads/2013/07/LinkedIn185.jpg
  3. LNKD: http://studio-5.financialcontent.com/investplace/quote?Symbol=LNKD
  4. [Image]: http://investorplace.com/wp-content/uploads/2011/11/Netflix.jpg
  5. NFLX: http://studio-5.financialcontent.com/investplace/quote?Symbol=NFLX
  6. crashed and burned in an epic meltdown: http://investorplace.com/2013/09/should-i-buy-netflix-stock-3-pros-3-cons-2/
  7. [Image]: http://investorplace.com/wp-content/uploads/2012/03/Tesla185.jpg
  8. TSLA: http://studio-5.financialcontent.com/investplace/quote?Symbol=TSLA
  9. a visionary CEO: http://investorplace.com/2013/09/investors-should-put-tesla-on-autopilot/

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