Church & Dwight: Positive and Consistent Price Momentum

Includes: CHD, SCSC
by: Jim Van Meerten

Last week I sold ScanSource (NASDAQ:SCSC) and needed a replacement. When I'm on the hunt, I first go to Barchart and screen for the stocks having the most frequent price appreciations in the last 20 sessions, take the top 10 and then do some additional screening to see what should be eliminated. The stock I had left was Church & Dwight Company Inc (CHD). The name didn't ring a bell with me and I was surprised to find that it was the name of holding company that owns Arm & Hammer - products I've been using for years.

First let's see why it came up on my list. The stock had a price appreciation in 14 of the last 20 trading sessions and was 5 for 5 recently. It has enjoyed a 7.97% price increase in the last month. On Barchart's 13 technical indicators the stock has a buy signal on 12 of the 13 indicators. This stock has the positive and consistent price momentum I like.

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On the fundamental side, analysts have 5 buy, 9 hold and only 1 under perform recommendation outstanding and 10 of them have increased their EPS estimates for the future in the last 30 days alone. They expect a 4.1% increase in revenue coupled with a 11.3% increase in earnings per share for the coming year. A 5 year compounded EPS growth rate of 12% is projected.

The stock enjoys growing investor sentiment. Some of that might have been triggered by a recent article on The naming CHD as one of the top 5 Mid Cap Stocks. On Motley Fool, CAPS members have noticed and voted that the stock will out perform the market by a vote of 303 to 15 and the All Stars agree 111 to 6. The Wall Street columnists Fool follows like the stock 8 to 0.

The reasons I like CHD:

  1. Recent price appreciation in more than 50% of the last 20 trading sessions
  2. Good analysts recommendations with positive revenue and earnings projected in the future
  3. A solid brand recognition on the products it owns
  4. Positive recent press on The
  5. Great investor sentiment as evidenced by the positive votes from Motley Fool members

I'm adding 150 shares of Church & Dwight to my Wall Street Survivor portfolio to replace ScanSource, which I sold last week when it failed to maintain a price above its 50 day moving average.

Disclosure: No positions at the time of publication