The stock market is in a very exciting place as we head into Q3 and Q4. What I’m seeing is a pattern of earnings surprises so pervasive that it leads me to believe many stocks are still undervalued. I also believe the economic picture, though complex, points to improvement that should further buoy them.
Yes, the global recovery is a bit sluggish. And yes, the debt ceiling debate are thorns in investors’ sides. But the Presidential Election Cycle and seasonal strength of the market this fall could mean now is the best buying opportunity you’ll see before 2012.
Here are my 5 top blue chip stocks for August:
Alexion Pharmaceuticals Inc.
Alexion Pharmaceuticals Inc. (NASDAQ:ALXN) specializes in rare and life-threatening diseases. In late June the company initiated a clinical trial of its drug Soliris to see if it could treat the infection behind the German E. coli scare. If it succeeds, it would be the perfect launching point into the European market. The stock is up 32% since our last issue thanks to strong earnings.
Lululemon Athletica Inc.
Lululemon Athletica Inc. (NASDAQ:LULU) creates high-end athletic apparel designed for runners and yoga buffs who like to look good while they sweat. In the first quarter LULU announced earnings of $0.22, a 163% year-over-year increase. It beat analysts’ estimates of $0.19, netting a 15% earnings surprise. What’s even more incredible is that LULU has been outperforming earnings estimates for over two years! Net revenue for the quarter increased 35% to $186.8 million from $138.3 million in the first quarter of fiscal 2010. For its upcoming quarter, the analyst community is estimating that Lululemon Athletica’s sales and earnings will rise 35.4% and 46.7%, respectively. The analyst community has been revising their consensus earning estimates higher by 4.6% in the past three months.
AutoZone Inc.
AutoZone Inc. (NYSE:AZO) has now been on the Top 5 List for seven consecutive months! and on July 14, AZO broke through its 52-week high. The company also remains remarkably steady in terms of financial health and it receives top marks for buying pressure. Earnings will be released in mid-September and should be impressive. As Americans drive their older cars longer and delay big ticket purchases like new autos, AZO is a good buy.
Priceline.com
Priceline.com (NASDAQ:PCLN) a global leader in online hotel reservations, is up 15% in the past month, and all of the signs point to continued success. The company announced a milestone in its new online airline ticketing service; its AA Direct Connect is now booking over 1,000 tickets a day! With an August 1 release date, PCLN’s next earnings announcement is right around the corner. In the last three months, the analyst community has revised their earnings estimates to be 12% higher, so things are shaping up nicely.
Apple
Apple (NASDAQ:AAPL) is a great growth stock right now, and utterly thrashed analysts’ expectations in its recent earnings report. Sales were up 82% from a year ago to $28.6 billion, and earnings once again more than doubled with a profit of $7.31 billion, or $7.79 per share, compared with a $3.25 billion profit, or $3.51 per share from last year. The analyst community predicted that Apple would post an EPS of $5.87, which the company blew past by 33%! This is what fueled the stock’s 23% move in the last month. Apple’s stunning sales and earnings will only get better when the iPhone 5 is released in September.
As of this writing, Louis Navellier was recommending all of these stocks in his Blue Chip Growth stock newsletter.
