The Dow index has had one of the worst weeks in years. Most stocks have posted significant losses in the month of August. However, some stocks might now be at or close to a bottom. Most likely the market will continue to be driven up or down by the events in Europe. If Greece defaults and a major European bank collapses, it could have a contagion effect on the rest of Europe and the world. If this happens, most stocks will be affected, but we are already seeing some stocks show strength in the face of very weak markets.
Stocks that are able to decouple from the market madness and go up, might be good for short term trading opportunities. A stock that shows strength at this point might just be having a good day, but it can also be a sign that the stock has bottomed out and wants to rise. If a stock can go up when markets plunge it might be even stronger when markets are less negative. Here are a few stocks worth watching for further gains based on recent strength:
JinkoSolar Holding Co., Ltd. (JKS) is trading at $6.10. The 50-day moving average is $17.55 and the 200-day moving average is $23.32. JKS has earnings estimates of about $5.39 per share for 2011 and $4.15 for 2012. This puts the PE ratio at under 2. JKS just announced idling of one factory due to possible pollution issues came to surface after protests from local resident. This caused the stock to plunge earlier this week but on Thursday, JKS shares were able to rise 34 cents or about 5.9% as the Down plunged almost 400 points.
Netflix, Inc. (NFLX) shares are trading around $128.53. Netflix is a leading Internet site for movie rentals. The 50-day moving average is $229.39 and the 200-day moving average is $227.35. Earnings estimates for NFLX are $4.67 per share in 2011. The 52 week range is $125.02 to $304.79. A couple of factors caused the stock to plunge in recent weeks which includes a change in pricing plans for Netflix subscribers that was not well received by customers and because Starz ended the negotiations to renew licensing deals with Netflix. Investors found out the hard way that it doesn't make sense to pay about 60 times earnings for a movie rental business. However, the shares might have some rebound potential now and on Thursday, NFLX shares were able to close slightly positive even as the Down plunged almost 400 points.
Yingli Green Energy Holding Co., Ltd. (YGE) is trading at $3.52. The relative strength index is about 23 which indicates the stock is very oversold. The 50-day moving average is $6.12 and the 200-day moving average is $9.60, so the shares are trading well below support levels. Estimates for YGE are about 93 cents per share in 2011, and 84 cents for 2012. This puts the PE ratio at about 3.7. YGE shares were able to rise 13 cents or about 3.8% as the Down plunged almost 400 points.
Vical Inc. (VICL) shares are trading at $2.72. Vical is a biotechnology company and is based in California. The 50-day moving average is $3.86 and the 200-day moving average is $3.16. The 52 week range is $1.70 to $5.30. Earnings estimates for VICL are for a loss of 21 cents per share in 2011 and a loss of 40 cents for 2012. VICL shares were able to rise 29 cents or about 12% as the Down plunged almost 400 points. This stock has plunged nearly 50% off the highs hit in July and the stock was oversold. It could have more rebound potential in the coming days.
Sycamore Networks (SCMR) shares are trading at $17.89. Sycamore makes networking equipment. These shares have traded in a range between $15.60 to $34.31 in the past 52 weeks. The 50-day moving average is $18.12 and the 200-day moving average is $21.21. Earnings estimates for SCMR are for a loss of 17 cents per share in 2011 and a profit of 13 cents for 2012. Sycamore shares were able to rise $2 or about 13% as the Down plunged almost 400 points. The stock looks expensive to me, and I would sell the rally.
The data is sourced from Yahoo Finance.
Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in JKS over the next 72 hours.