Last week’s picks*:
VA: HP +3.54%
MR: MGI +0.23%
ST: OREX +4.07%
SS: BJRI -1.98%
TF: GHC -1.99%
Mixed performance last week. I’ve never eaten at BJ’s Restaurants so can’t comment on the food they serve there but I’ve had two cracks at shorting it now and both times I’ve been left wanting.
Fortunately, the losses were offset by some moderate gains in oil driller HP and biotech firm OREX.
I fancy some more gains in the energy space this week, particularly after Friday’s surprise rate cut by the PBOC and with OPECs production meeting coming up on Thursday.
Thanksgiving week is typically favourable for markets so we could see another quiet week where indices edge higher once more.
Here’s this week’s picks: (vote for your favourite at the end!)
Freeport McMoRan $FCX
After Friday’s rate cut in China, and continued dovishness from ECB Chief Mario Draghi, I’m betting on a rebound in commodities this week. Freeport McMoRan is one of the biggest gold and copper producers in the world and shares gapped up nicely on Friday after the news.
The company is also very cheap and trades with a PEG of 0.36 and PE ratio of 13.76. There are a lot of shorts in energy and commodity shares so a short squeeze could be on the cards.
Navigators Group Inc $NAVG
Navigators Group is a specialty insurance company with over $1 billion in annual revenue. The company prides itself on its solid balance sheet and quick response times and has offices in all of the major economic countries.
Shares hit a new 52-week high on Friday although they are not too expensively priced with a PE ratio of 11.59 and PEG of 0.97. Shares also finished near their highs so could continue to edge higher this week.
Deere & Co. $DE
Tractor manufacturer Deer & Co. has a solid set of financials and is attractively valued with a PE ratio of 9.93 and ROE of 31%. The company reports earnings before the market on Wednesday so there will plenty of action approaching the release.
Although it’s not usually a good idea to bet on earnings numbers, DE has been moving higher of late and has a lot of bullish sentiment behind it.
Foot Locker Inc. $FL
A lot of StockTwits users are bullish on Foot Locker this week after the footwear retailer reported earnings on Friday then subsequently plunged 4.30%. Although earnings were strong, traders were put off after the company said it would close 25 stores. The stock now has a 100% bullish rating on StockTwits and traders are looking for a sharp rebound this week.
Another stock being talked about with bullish potential is $JASO.
Ani Pharmaceuticals Inc. $ANIP
It could be a difficult week for short sellers but I’m going for Ani Pharmaceuticals Inc., a US based manufacturer of prescription medicines with a market cap of $623 million.
Shares in Ani are up a whopping 174% year-to-date giving them a daily RSI overbought reading of 81.26 and a PE ratio of 52.93.
The stock closed slightly lower on Friday and is well overdue for a pullback.
Let me know what your favourite pick is by completing the quick poll below and if you have any others you’re looking at, leave them in the comments below!
*Hypothetical results. Commissions and slippage not applied.
Disclosure: I have no positions in any stocks mentioned but may initiate a position in FCX over the next 72 hours.
Additional Disclaimer: Please be aware of the usual risks to trading in financial instruments. Please remember the importance of doing your own research and understand the cost to trade including trading commissions and the bid:ask spread.
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