U.S. equities soared on Thursday, reversing a two-week malaise, after Walmart (NYSE:WMT) reported solid results and headlines that China’s Vice Commerce Minister would visit the United States for trade talks in late August. This has raised hopes for an end to the ongoing trade spat.
The Dow Jones Industrial Average was up more than 426 points as of this writing, enjoying a picture-perfect bounce off of its 50-day moving average and the psychologically important 25,000 level on Wednesday. That shows just how much today’s markets are pushed and pulled by computer trading algorithms waiting for these lines in the sand to come into play.
Accompanying the Dow’s surge were a number of mega-cap stocks breaking out of multi-week or multi-month consolidation ranges. Here are five mega-cap stocks (besides Walmart) to buy now:
Mega-Cap Stocks to Buy: Apple (AAPL)
Apple (NASDAQ:AAPL) shares are pushing to new record highs, rising above the $210-a-share level for a total gain of more than 30% from the lows seen in late April. The company has benefited from increased iPhone revenues despite tepid unit sales as higher average selling prices have padded top-line growth. Watch for sales volumes to reaccelerate later this year, with a top-top-bottom iPhone refresh coming as the iPhone X form factor becomes standardized.
The company will next report on Oct. 30, after the close. Analysts are looking for earnings of $2.75-per-share on revenues of $61 billion. When the company last reported on July 31, earnings of $2.34 beat estimates by 16 cents on a 17.3% rise in revenues.
Mega-Cap Stocks to Buy: Johnson & Johnson (JNJ)
Johnson & Johnson (NYSE:JNJ) shares are boosting back above their 200-day moving average to test the upper end of a trading range going back to early February. An upside extension would put the January high near $146 in play, which would be worth a 10%+ gain from here. Shares have been coiling up for a move higher since the company reported its 20th straight quarter of beating earnings estimates.
The company will next report results on Oct. 16, before the bell. Analysts are looking for earnings of $2.03-per-share on revenues of $20 billion. When the company last reported on July 17, earnings of $2.10 beat estimates by 3 cents on a 10.6% rise in revenues.
Mega-Cap Stocks to Buy: Merck (MRK)
Merck (NYSE:MRK) shares are lifting to new highs, rising up and over resistance from their 2017 trading range for a gain of more than 30% from the lows seen back in April. Shares have benefited from the growing interest in healthcare stocks over the past few months, with the Health Care SPDR (ETF) (NYSEARCA:XLV) up more than 15% since May.
The company will next report results on Oct. 26, before the bell. Analysts are looking for earnings of $1.15-per-share on revenues of $10.9 billion. When the company last reported on July 27, earnings of $1.06-per-share beat estimates by 3 cents on a 5.4% rise in revenues.
Mega-Cap Stocks to Buy: Procter & Gamble (PG)
Procter & Gamble (NYSE:PG) shares are popping up to levels not seen since early February, extending its rally above its 200-day and 50-day moving averages. This could be an end to the downtrend pattern that started last September as shares return to levels first hit in late 2016 as defensive areas of the market — healthcare, consumer staples and utilities — enjoy a surge of fresh buying.
The company will next report results on Oct. 30, before the bell. Analysts are looking for earnings of $1.10-per-share on revenues of $16.6 billion. When the company last reported on July 31, earnings of 94-cents-per-share beat estimates by 4 cents on a 2.6% rise in revenues.
Mega-Cap Stocks to Buy: Verizon (VZ)
Verizon (NYSE:VZ) shares are popping up and over critical resistance going back to January, exiting a sideways trading range going back to 2016. Telecom stocks in general, as represented by the iShares Telecommunications ETF (BATS:IYZ), are exiting a three-year downtrend with a move above their 200-week and 50-week moving averages. Again, a bid in defensive assets is driving this.
The company will next report results on Oct. 23, before the bell. Analysts are looking for earnings of $1.18-per-share on revenues of $32.2 billion. When the company last reported on July 24, earnings of $1.20-per-share beat estimates by 5 cents on a 5.4% rise in revenues.
Anthony Mirhaydari is founder of the Edge (ETFs) and Edge Pro (Options) investment advisory newsletters. Free two- and four-week trial offers have been extended to InvestorPlace readers.
