Five members of the Dow Jones Industrial Average top the list of stocks to watch this week near buy points. Although each of the stocks is listed on the Dow Jones, each comes from a different sector. Boeing shares are exploitable as air travel resumes. JPMorgan Chase (JPM) is taking shape as the banking sector shows signs of stabilization. Retail and fast food giants walmart (WMT) and McDonald’s (MCD) do list, with computer network and software vendor Cisco Systems (CSCO).
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Boeing stock
Aerospace and defense giant Boeing reported lower losses and improved sales in the past two quarters. The company’s commercial aircraft unit posted strong revenue gains as travel demand and volume return to pre-pandemic levels. And analysts don’t expect recent production delays for the 737 Max and 787 Dreamliner to have a major impact on Boeing’s delivery schedule, JPMorgan wrote in a research note Wednesday.
BA stock was added to SwingTrader on Thursday. Boeing is actionable from its short-term levels and its trendline. Shares are trading just below a buy point of 221.33 in a flat base dating back nearly four months after a strong uptrend that began in November.
Boeing stock has a composite rating of 86 out of the best possible rating of 99. The composite rating combines various technical indicators into one easy-to-read score. Its relative strength line has been off year-to-date highs and BA stock has an RS rating of 92 out of 99. However, the string of quarterly losses earns Boeing stock a meager EPS rating of 59.
Boeing shares are up 14% year-to-date.
JPMorgan Stock
JPMorgan Chase is doing much better than most banks after the string of bankruptcies in March. The New York banking juggernaut bailed out First Republic Bank in early May and the sector appears to have stabilized in recent weeks. However, many risks still hang over the sector and the full impact of bank failures is still unknown.
JPMorgan has more than $3.7 trillion in assets and leads the Banks-Money Center group, according to IBD Stock Checkup.
JPM stock is trending towards a buy point of 143.37 on a flat basis. The current pattern could be seen as a handful to a consolidation going back four months.
JPMorgan has a near-perfect composite rating of 96. The bank’s earnings and revenue have accelerated over the past three quarters, earning it an EPS rating of 92. JPMorgan has an RS rating of 80.
JPM stock is up 5.15% so far this year.
Cisco stock
Cisco, based in San Jose, Calif., aims to increase revenue by shifting its core business from selling network switches and routers to software and services through acquisitions. The company’s sales growth has accelerated over the past three quarters and its earnings gains have increased over the past two quarters.
A few other networking stocks are gearing up for more robust growth, including Arista Networks (ANET) and Extreme networks (EXT).
Cisco ranks fourth in the Computer-Networking group, led by Extreme Networks.
CSCO stock is trading in a cut basis with a buy point of 52.56 on a daily chart. He is working on a handle that could offer an entry of 50.58 after Monday. On a weekly chart, Cisco already has a handle with this buy point of 50.58. But Cisco’s latest base follows two flat bases that have fizzled, and those have been on a long downtrend.
CSCO stock is hovering around its 10-day moving average but holding above its other technical lines.
Cisco stock has a composite rating of 80 and an EPS rating of 82. CSCO stocks have an RS rating of 69 because they outperform about two-thirds of stocks in the market.
CSCO stock is up 4.2% in 2023.
McDonald’s stock
McDonald’s, the world’s largest restaurant chain by number of locations, reported a 15% increase in adjusted earnings for its first-quarter earnings report in April. Revenue rose 4.1% to hit high estimates and end a streak of quarterly declines. Traffic grew despite higher menu prices and double-digit comparable sales in the past two quarters.
Following the results, BMO Capital raised its price target on MCD stock on April 26, noting that McDonald’s should be able to maintain its strong momentum and continue to gain market share, especially in an environment lower consumption. BMO Capital raised its price target from 300 to 325.
MCD stock is in a buy zone for its previous buy point of 281.67, but is trading below its 50-day moving average and below its 21-day exponential line.
It was forming another flat base at Friday’s close with a buy point of 298.86. A strong move above the 50-day line at 289.65 would also break its trendline, offering two reasons for an early entry.
McDonald’s stock has a composite rating of 81 and an EPS rating of 86 after two quarters of double-digit earnings growth. Its relative strength line is below recent highs in mid-May and its RS rating is 80.
MCD shares are up 8.8% since the start of the year.
Walmart Stock
Retail results have been mixed this earnings season and many companies have warned of a slowdown in sales in the near term as macroeconomic conditions and inflation hamper consumer spending. But Walmart’s earnings have accelerated the past three quarters, benefiting from a bear trade mentality as customers seek to cut costs. Walmart noted strong same-store sales growth and market share gains in its U.S. grocery sales for its first quarter report, including among high-income households. The company raised its full-year earnings forecast from 15 cents per share to 20 cents per share after the results.
Walmart ranks second in the Retail-Major Discount Chains group, behind only Costco (COST).
WMT stock is in the buy zone from a buy point at 148.34 double bottom and rebounded from its 50-day line last week. Investors could also view 154.35 as an alternative handle entry as stocks approach the buy point for a cup-with-handle base on MarketSmith’s weekly chart.
Walmart has a strong composite rating of 85. The shares have an EPS rating of 88 and an RS rating of 82.
WMT stock is up 8% so far this year.
You can follow Harrison Miller for more stock info and updates on Twitter. @IBD_Harrison.
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