At StateoftheMarkets.com, we strive to “own the best and ignore the rest” in our equity portfolios. Toward this end, each day we search our database for a “top stock” (a top rated company in terms of earnings strength as well as company and industry performance) that presents a strong technical “set up” and a good entry point.
In short, when our equity team is looking to add a stock to one of our portfolios, the “bull’s eye” stock shown below is generally their first choice.
Why We Like The Stock:
Rock-Tenn (RKT) is our most compelling buy today due to the fact that it is a top rated stock (in terms of earnings strength and company/industry performance) with a positive technical set-up. While Materials stocks have had a very up and down year, Paper Packaging stocks like Packaging Corp of America (PKG), Sealed Air Corp. (SEE) and RKT have been phenomenal.
RKT is in a long-term uptrend dating back to June of 2012, pulling back modestly along the way. The stock tends to make higher highs and higher lows while operating slightly above the 50-day moving average. This morning, RKT opened on top of its 5- and 50-day moving average and subsequently skyrocketed +4.30%, crossing above all other major short-term moving averages. That is not to say that buying at current prices would be “missing the move,” as RKT recently traded right around $107.50 in mid-June. And, judging by the strength of its uptrend, that is probably not the ceiling for this stock moving forward. We like RKT at current prices and would be buyers here.
We Would Be Buyers:
At the current price (~$104.18).
Rock-Tenn Company (RockTenn) is a North America’s integrated manufacturer of corrugated and consumer packaging. The Company operates locations in the United States, Canada, Mexico, Chile, Argentina, Puerto Rico and China. The Company operates in three segments: Corrugated Packaging, consisting of its containerboard mills and its corrugated converting operations; Consumer Packaging, consisting of its coated and uncoated paperboard mills, consumer packaging converting operations and merchandising display facilities, and Recycling, which consists of its recycled fiber brokerage and collection operations. On June 22, 2012, the Company acquired Mid South Packaging LLC. On Oct. 28, 2011, the Company acquired four entities doing business as GMI Group.
The Stock Rating indicates the combined score of our proprietary Earning Strength and Company Performance models. The rating scale is 0 – 10 with 10 being the highest.
At the time of publication the editor and affiliated companies own the following positions:
Note: Positions may be bought or sold while this publication is in circulation without notice.
Rock-Tenn – Last 3 Months
Rock-Tenn Co – Last 12 Months
Rock-Tenn – Last 5 Years