As we move deeper into earnings season investors have been focusing on the big, well-known names and trying to trade them based on their best guess of the numbers. While this can make for a great deal of excitement it is not necessarily the best way to trade in earnings season.
It makes more sense to me to look for stocks to buy that are posting fantastic results and being upgraded to a “buy” in Portfolio Grader. These are the stocks where the underlying fundamentals of the company are going to attract the buying power of the big institutions.
The market advance continues to narrow — you need to focus on companies that are exhibiting the best-of-the-best fundamentals that can drive the shares higher.
Amkor Technologies (AMKR) outsources semiconductor packaging and test services both in the U.S. and around the world. Amkor has 16 facilities with over 5.5 million square feet of space in seven countries right now. Analysts expected the company to have a very weak first quarter, but Amkor exceeded expectations by a wide margin.
CEO Steve Kelley thinks that business is just going to keep getting better and told investors, “Driven by stronger customer forecasts for mobile devices and continued momentum from our growth initiatives, our expectations for the second quarter and full year 2014 have improved considerably.” Portfolio Grader thinks so as well — last week the rating program raised the stock to an “A,” meaning the shares are a “strong buy” at the current price.
Wall Street has been negative on the precious metals for some time now. I have no idea what the metals markets may do — but at least one miner is seeing results that are blowing away Wall Street’s conservative expectations.
Agnico-Eagle Mines (AEM) runs mineral properties in Canada, Finland and Mexico. Gold is AEM’s primary focus but it also looks for and mines silver, copper, zinc and lead.
Agnico-Eagle reported earnings last week of $0.56 a share, more than twice the downbeat analysts’ estimates of just $0.25. Following this huge earnings surprise Portfolio Grader has upgraded the stock to a “B” — the gold miner is a “buy” at the current price.
Coal is another industry that is supposed to be weak … but some forgot to tell the folks at Consolidated Energy (CNX). Consolidated mines and sells steam coal (primarily to electric power generation industry) and metallurgical coal (to steel and coke producers).
The company posted first-quarter earnings of $0.50 a share, compared with a loss of a penny a share a year earlier. Analysts had expected just $0.19 a share and have been scrambling to raise estimates for the year following the large positive earnings surprise. Portfolio Grader upgraded the stock after the fantastic quarter to a “B,” and CNX shares are a “buy” at the current price.
Earnings season can be a confusing time with news coming at you fast and furious. Portfolio Grader can help you deal with the noise and confusion, identifying surprising stocks to buy that are delivering superior results that can beat the market.
Louis Navellier is the editor of Blue Chip Growth.