5 Stocks At All Time Highs That Are Just Getting Warmed Up

Includes: DLTR, MA, MCD, MNK, PM
by: Brian Nichols

The Dow Jones is trading 6% from its 52 week highs, and its trading 17% from its all time highs, however there are some stocks trading against the market's trend and posting new all-time highs. These stocks have outperformed the market year-after-year to post large gains despite a recession in 2009 and a European financial crisis that's plagued the markets over the last four months. And although some of these stocks may be near resistance and could trend slightly lower there are many more that are just getting warmed up and have the potential to continue trending much higher. Below are 5 stocks that are trading at all-time highs with fundamentals that keep getting better which I believe will push the stock even higher over the next 12 months.

Chart forDollar Tree, Inc. (NASDAQ:<a href='https://seekingalpha.com/symbol/DLTR' title='Dollar Tree, Inc.'>DLTR</a>)

Dollar Tree (DLTR) reached an all-time high price on Thursday of $83.14. The stock has consistently trended higher for the last four years, which can be seen on the chart above. During the last year DLTR has posted gains of 46.7%, and a 300% gain over the last four years. The stock trades with a market cap of $9.77 billion and a P/E ratio of 21.90. I believe the stock could potentially support a slightly higher P/E ratio however, investors have done a good job at not allowing this stock to become a momentum investment. DLTR trades off fundamental progress and consistently grows year-over-year therefore its stock continues to rise. The stock trades with a beta of 0.38 and has incredibly high institutional ownership which keeps its trend logical in a market that trades off emotion. I believe the trend will continue to rise and that investors can expect fundamental gains for the next few years. DLTR is fairly simple stock, if its earnings go up then so does it stock, and because of its expansion there is no reason to believe that earnings won't continue to rise.

Chart forMcDonald

As you can see from the chart above McDonald's (NYSE:MCD) is a stock that's consistently traded against the market over the last five years. And the last five years haven't been easy -- there's been a recession and a European financial crisis -- yet McDonald's stock overcomes and outperforms despite obstacles within the economy. McDonald's has a product that will perform regardless of the economic situation with its low price and good food. During 2010 the company had a record year, as it posted $24 billion in revenue, however the company's outperformed 2010's revenue by nearly $2.5 billion during the last 12 months which is simply remarkable. The major changes within the company have been its expansion in emerging markets and the company's ability to adopt various cultures into its product along with its McCafe which has attracted a new consumer base. The stock is currently trading with a P/E ratio of 18.72 which I believe is near the top of its range, the company could possibly reach 20 because of its growth. However, I believe at this time the stock's fairly priced with a short-term upside of 5%. The company's growing earnings by 9% year-over-year and is outperforming revenue by 13%. Therefore I believe that if the company continues at this pace it will be capable of posting a gain of 15-20% over the next year along with continuing its trend of increasing its dividend, which has nearly doubled since 2008.

Chart forMastercard Incorporated (NYSE:<a href='https://seekingalpha.com/symbol/MA' title='Mastercard, Inc.'>MA</a>)

MasterCard (MA) reached an all-time high of $381.96 after an incredible year of growth. During its most recent quarter the company increased earnings by 38.4% and grew revenue by 27.3% year-over-year, which indicates higher margins. The company's profit margin during its most recent quarter was 39%, or 4% higher than its twelve month average. The company's return on assets and equity are among industry best, and it's increased its cash by nearly $800 million year-over-year. The bottom line is that this company is growing at an incredible rate and deserves all of its 53.5% gain over the last year. A large portion of the stock's gains have come during the sell-off within the market. In fact the stock's increased 24% since July 29 while the S&P 500 has declined 6% which shows significant strength within the stock. Because of the company's remarkable growth and its gains during the sell-off within the market I believe it presents a significant amount of value at all-time highs. In fact, I believe the stock could trade with a P/E ratio of 30, if market conditions were better, and I believe that with its earnings growth this stock could potentially surpass $550 during the next 12 months.

Chart forQuestcor Pharmaceuticals, Inc. (QCOR)

Questcor Pharmaceuticals (QCOR) has been creating new all-time highs for the last two years because of its success with the multi-purpose drug Acthar. The company's lead drug Acthar has been growing at an incredible rate, which includes a 174% gain during its most recent quarter. The potential of this drug is mindboggling and what's more impressive is the variety of conditions that this drug is believed to treat. The company is just now in the initial phases of growth and is yet to tap the full market for this drug, with only 12% of neurologists having written a prescription for Acthar. The company's recently placed a large amount of emphasis on sales and has increased its sales team from 5 to 28 associates. The only concern is the stock's valuation because it trades nearly 53x earnings, however the stock's forward P/E is 23.46 which means that analysts project the company's earnings to continue rising at the same level. So far, analysts have been unable to predict QCOR's explosive growth which include near doubling revenue and earnings year-over-year. The company has great margins and returns a large percentage of its assets, and equity, therefore I believe earnings will either meet or most likely exceed future expectations. And although the company's valuation is high, its earnings are high as well, and I believe it's very possible that this stock more than doubles over the next year and maintains its high valuation despite explosive growth.

Chart forPhilip Morris International, Inc. (NYSE:<a href='https://seekingalpha.com/symbol/PM' title='Philip Morris International Inc.'>PM</a>)

There is one fact that's absolutely certain: Regardless of how bad the economy gets those who smoke will continue to smoke. If you're looking for a stock that can survive and excel through adversity then Philip Morris (PM) would make a great addition to your portfolio. The stock created new highs of $77 on Thursday and has now posted a one-year gain of 31% to go along with its 4.07 yield. The company's growing at a rapid rate which include revenue and earnings growth of near 30% year-over-year. The stock currently trades with a P/E ratio of 16 and a market cap of $131.5 billion. I believe the stock will rise over the next year, by another 30%, however I doubt the stock will trade much higher above earnings, a P/E ratio of 19 is possible. Philip Morris may be the best investment within the market because it has a product that will not fade regardless of the economy. There is no other product in the world that could withstand regulations on advertising; drastic increases on taxes; countless lawsuits; and bad press then continue to trend higher. However Philip Morris, and other tobacco companies have excelled and continued to grow a rapid rate. This fact should give investors peace of mind in knowing that there investment will continue to grow and return gains for many years to come.

Disclosure: I am long MCD, DLTR, QCOR.