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3 Dow Jones Titans Ready to Break Out (HD, KO, MCD)

The bulls are playing defense on Tuesday after five straight days worth of gains.

3 Dow Jones Titans Ready to Breakout (HD, KO, MCD)

Source: ©iStock.com/mrvintervind

The major indices are trading with minor losses as the Dow Jones hits resistance near the 17,000 level. Back in October, during the climb out of the August-September unpleasantness, there was a similar pause for breath near 17,000.

Hopefully, this will also prove to merely be a temporary pause on the way to higher prices. In October, the pullback was limited to two days.

What that in mind, here are three Dow Jones titans that look ready for an upside breakout — prime candidates for investors looking for opportunities amid what appears to be a classic “buy-the-dip” dynamic.

Dow Jones Titans Breaking Out: Home Depot Inc (HD)

3-8-16-HD-Stock

Shares of home improvement retailer Home Depot (HD) are breaking up and over three-month resistance near $126, as the stocks works toward the $130 level — the major support line from December.

Shares have been a strong performer since the summer of 2014, handily outperforming the broad Dow Jones with a gain of roughly 80% into its November high vs. just a 6% or so gain in the Dow over that time.

The company reported solid quarterly results back in late February, with Q4 sales up 9.5% over last year to boost earnings 11.4% to $1.17 per share.

That record-setting performance was driven by a 7.1% increase in comp-store sales and a 0.72% expansion in its operating margin. A return to its prior high would be worth about a 6% gain from here.

Dow Jones Titans Breaking Out: The Coca-Cola Co (KO)

 3-8-16-KO-Stock

Shares of soda icon Coca-Cola (KO) have broken up and over four-month resistance near $44 to push to fresh record highs.

Momentum built off of a solid earnings report on Feb. 9, with earnings of 38 cents per share meeting expectations. Global volume grew 3% in the fourth quarter driven by a 7% increase in its Coke Zero product.

More healthful options performed very well, with packaged water up 8%, ready-to-drink tea up 6% and a 5% jump in juice drinks.

Looking ahead, the company expects organic 2016 revenue growth of upward of 5% driving earnings growth of upward of 6%.

Dow Jones Titans Breaking Out: McDonald’s Corporation (MCD)

 3-8-16-MCD-Stock

Shares of burger maker McDonald’s (MCD) look ready to make another run away from its tight consolidation range near $117.50 that’s been in place since December.

Aside from a nice pop back in the fourth quarter, the stock has been stagnating since 2012 on doubts over the company’s product strategy.

Analysts are Argus are optimistic about its turnaround plan thanks to strong comp-store sales growth driven by its all-day breakfast initiative. They maintain a target of $140, which would be worth a gain of around 20% from current levels.

Anthony Mirhaydari is founder of the Edge and Edge Pro investment advisory newsletters. A two-week and four-week free trial offer has been extended to InvestorPlace readers.


Article printed from InvestorPlace Media, https://investorplace.com/2016/03/dow-jones-hd-mcd-ko/.

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