5 Top Stocks to Own

Today I sorted Barchart's Top Stocks to Own list first by the highest Weighted Alpha, then by technical buy signals of 80% or more and lastly used the FlipChart feature to review the charts for consistency.  Today's Watch List includes:

Teladoc (TDOC), Sage Therapeutics (SAGE), Nevectra (NVTR), Impinj (PI) and Enzo Biochem (ENZ)

Teladoc (TDOC)

Barchart technical indicators:

• 100% Barchart technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 9 new highs and up 19.06% in the last month
• Relative Strength Index 68.255
• Technical support level at 33.27
• Recently traded at 35.35 with a 50 day moving average of 28.43

Sage Therapeutics (SAGE)

Barchart technical indicators:

• 100% technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 12 new highs and up 27.33% in the last month
• Relative Strength Index 74.83%
• Technical support level at 77.08
• Recently traded at 83.37 with a 50 day moving average of 70.82

Nevectra (NVTR)

Barchart technical indicators:

• 100% technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 12 new highs and up 40.00% in the last month
• Relative Strength Index 81.64%
• Technical support level at 50.75
• Recently traded at 56.91 with a 50 day moving average of 40.81

Impinj (PI)

Barchart technical indicators:

• 100% technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 7 new highs and up 38.34% in the last month
• Relative Strength Index 73.81%
• Technical support level at 50.75
• Recently traded at 56.91 with a 50 day moving average of 40.81

Enzo Biochem (ENZ)

Barchart technical indicators:

• 100% technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 9 new highs and up 19.73% in the last month
• Relative Strength Index 70.55%
• Technical support level at 10.41
• Recently traded at 10.90 with a 50 day moving average of 9.07

How to Beat the Market

I'm often asked how I personally invest.  My method isn't for everyone but it works for me. All I really want is a portfolio of about 10 stocks that are all trading above their 20, 50 and 100 day moving averages.  Sounds simple but it takes a good screener, daily tracking and lots of discipline.

I've got a couple of other rules to help prevent me from losing money.  I only want to invest when both the economy and the stock market are expanding - I'm on the side line is either is contracting.  I use the Conference Board  to show me the leading and lagging economic indicators to gauge whether the economy is expanding or contracting and Barchart's Market Momentum page to see if the stock market is expanding or contracting.  The percentage of stocks trading above their 20, 50 and 100 day moving is my guide with 50% above being my benchmark.

A rising tide floats all boats and an ebbing tide lowers all boats.  Now you know why my first bog was titled Financial Tides.  I try to stay on the right side of the market.

Next I don't want to follow or even compete with the herd.  Most mutual funds, managed money and financial institutions have portfolios greater that $10 million dollars.  Because of their size they are almost exclusively invested in the S&P 500 Large Cap, S&P 400 Mid Cap , S&P 600 Small Cap and NASDAQ 100 stocks.  These 1600 stocks comprise well over 95% of the total capitalization of the US stock market.  I want to be in that other 5% where all the big boys with their full time MBAs, CFAs and ungodly computer power really can't operate.

Over time I have found that the  5% I look for usually has the same attributes - Market Cap under $2 billion and currently trading below $10.  I set my screener for those stocks then sort for new high frequency in the last month and use the Flipchart feature to review the charts.

I'm fully invested now and so I have no ability to buy the stocks in today's screen but this is how I found the stocks I presently own in my own portfolio.

The list today includes Energy Recovery (ERII), Kofax (KFX), Enzo Biochhem (ENZ), Obscene Jeans (OBJE) and Newcastle Investments (NCT):

Energy Recovery (ERII)

Barchart technical indicators:

• 96% Barchart technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 17 new highs and up 36.26% in the last month
• Relative Strength Index 64.64%
• Barchart computes a technical support level at 5.64
• Recently traded at 5.87 with a 50 day moving average of 5.11

Kofax (KFX)

Barchart technical indicators:

• 64% Barchart technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 16 new highs and up 30.71% in the last month
• Relative Strength Index 70.71%
• Barchart computes a technical support level at 8.86
• Recently traded at 9.16 with a 50 day moving average of 7.87

Enzo Biochem (ENZ)

Barchart technical indicators:

• 96% Barchart technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 15 new highs and up 45.55% in the last month
• Relative Strength Index 81.05%
• Barchart computes a technical support level at 5.10
• Recently traded at 5.37 with a 50 day moving average of 4.19

Obscene Jeans (OBJE)

Barchart technical indicators:

• 64% Barchart technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 15 new highs and up 190.39% in the last month
• Relative Strength Index 71.25%
• Barchart computes a technical support level at .1368
• Recently traded at .1420 with a 50 day moving average of .0808

Newcastle Investments (NCT)

Barchart technical indicators:

• 80% Barchart technical buy signals
• Trend Spotter buy signal
• Above its 20, 50 and 100 day moving averages
• 14 new highs and up 7.51% in the last month
• Relative Strength Index 63.80%
• Barchart computes a technical support level at 4.98
• Recently traded at 5.02 with a 50 day moving average of 4.68

Barchart Morning Call 6/21

BARCHART MORNING CALL

Friday, June 21st, 2013View Older Reports

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OVERNIGHT MARKETS AND NEWS

September E-mini S&Ps (ESU13 +0.57%) this morning are up +0.77% and European stocks are up +0.63%. Asian stocks closed mostly lower: Japan +1.66%, Hong Kong -0.59%, China -0.18%, Taiwan -1.34%, Australia -0.41%, Singapore -0.28%, South Korea -1.54%, India +0.29%. U.S. and European stocks are recovering from this week's sell-off, while Chinese money-market rates fell back from records after the PBOC added funds to the banking system. Commodity prices are mostly higher. Aug WTI crude oil (CLQ13 +0.46%) is up +0.39%. Aug gasoline (RBQ13 +0.56%) is up +0.56%, Aug natural gas (NGQ13 +0.15%) is up +0.26%, Aug gold (GCQ13 +0.52%) is up +0.53% and July copper (HGN13 +0.38%) is up +0.44%. Agriculture prices are lower. The dollar index (DXY00 +0.03%) is down -0.07%. EUR/USD (^EURUSD) is down -0.05%. USD/JPY (^USDJPY) is up +0.38%. September 10-year T-note futures prices (ZNU13 -0.01%) this morning are up +2.5 ticks.
St. Louis Fed President Bullard, who dissented in this week's FOMC decision to keep QE at present levels, said the Fed "inappropriately timed" its decision to lay out a plan to taper the pace of QE. Bullard said "a more prudent approach would be to wait for tangible signs the economy was strengthening and that inflation was on a path to return toward target before making such as announcement." He added that it was a mistake to make such an announcement the same day as the Fed marked down forecasts of economic growth and inflation for this year and that "policy action should be undertaken to meet policy objectives and not calendar objectives."
The Eurozone May current account (sa) fell to a 19.5 billion euro surplus from a 25.9 billion euro surplus in April.
UK May public sector net borrowing rose to 10.5 billion pounds from a revised 6.6 billion pounds in Apr, slower than expectations of 13.5 billion pounds.
China's money-market rates tumbled from record highs after the PBOC injected funds into the banking system via reverse-repurchase agreements to alleviate a cash crunch. China's overnight repurchase rate dropped 442 bp to 8.43%, and the 7-day rate fell 227 bp to 8.50%. The PBOC had refrained from using open-market operations to add funds to the banking system since Feb in an attempt to regulate shadow banking and to direct more money toward growth rather than speculation.

U.S. STOCK PREVIEW

There are no economic reports today but the markets will continue to adjust to Fed Chairman Bernanke's announcement on Wednesday of the likely schedule for ending QE3.  There are two of the Russell 1000 companies that report earnings today:  Darden Restaurants (consensus $1.04), and CarMax (0.58).  Equity conferences today include St. Petersburg International Economic Forum (SPIEF 2013) on Thu-Fri.

OVERNIGHT U.S. STOCK MOVERS

CarMax (KMX -6.11%) reported Q1 EPS of 64 cents, better than consensus of 58 cents.
Cardinal Health (CAH -2.69%) was upgraded to "Outperform" from "Market Perform" at William Blair.
Newmont Mining (NEM -6.74%) was downgraded to "Neutral" from "Buy" at UBS following a lowered gold price target at the firm.
Facebook (FB -1.69%) was upgraded to "Buy" from "Neutral" at UBS who also raised their price target on the stock to $30 from $28.
Darden Restaurants (DRI -2.64%) reported Q4 EPS of $1.02, weaker than consensus of $1.04.
Forest Oil (FST -4.44%) will replace Enzo Biochem (ENZ -1.73%) in the S&P SmallCap 600 as of the June 28 close.
News Corp. (NWSA -2.95%) will replace Apollo Group (APOL -0.75%) in the S&P 500 and Apollo Group will replace Forest Oil (FST -4.44%) in the S&P MidCap 400 as of the June 28 close.
iCAD (ICAD -1.37%) announced approval by the U.S. Food and Drug Administration for use of the company’s SecondLook mammography computer-aided detection system.
TIBCO (TIBX -1.73%) reported Q2 adjusted EPS of 18 cents, right on consensus, and reported Q2 revenue of $245.8 million, slightly below consensus of $246.55 million.
Oracle (ORCL -2.58%) slumped nearly 8% in after-hours trading after it reported Q4 adjusted EPS of 87 cents, right on consensus, and said Q4 adjusted revenue was $11.0 billion, slightly below consensus of $11.12 billion. Oracle also raised its quarterly dividend to 12 cents from 6 cents, announced a $12 billion share buyback program, and said it will list its stock on the NYSE.

MARKET COMMENTS

September E-mini S&Ps (ESU13 +0.57%) this morning are up +12.25 points (+0.77%). The S&P 500 index on Thursday slumped to 1-1/2-month low and closed lower. Bearish factors included (1) the surge in the 10-year T-note yield to a 1-3/4 year high of 2.47% on Fed Chairman Bernanke’s timetable for ending QE3, and (2) concern about the Chinese economy after the China Jun HSBC flash manufacturing PMI fell to a 9-month low of 48.3 from 49.2 in May. Stocks ignored the rise in the Jun Philadelphia Fed manufacturing index to a 2-year high and the rise in May existing home sales to a 3-1/3 year high. Closes: S&P 500 -2.50%, Dow Jones -2.34%, Nasdaq 100 -2.34%.
September 10-year T-notes (ZNU13 -0.01%) this morning are up +2.5 ticks. Sep 10-year T-note futures prices on Thursday plummeted to a contract low. The 10-year T-note yield catapulted up to a 1-3/4 year high of 2.47% on carry-over bearishness from Wednesday’s comments from Fed Chairman Bernanke who said that the Fed will likely trim QE3 later this year. T-notes failed to garner much support from either the larger-than-expected increase in weekly jobless claims or the plunge in stocks. Closes: TYU3 -26.00, FVU3 -13.25.

The dollar index (DXY00 +0.03%) this morning is down -0.054 (-0.07%). EUR/USD (^EURUSD) is down -0.0006 (-0.05%) and USD/JPY (^USDJPY) is up +0.37 (+0.38%). The dollar index on Thursday climbed to a 2-week high and closed higher. The dollar strengthened on (1) carry-over support from Wednesday’s comments from Fed Chairman Bernanke who signaled the Fed is getting closer to reducing its dollar-negative QE3 program, and (2) stronger-than-expected May existing home sales and Jun Philadelphia Fed manufacturing reports. Closes: Dollar index +0.487 (+0.60%), EUR/USD -0.00754 (-0.57%), USD/JPY +0.832 (+0.86%).
Aug WTI crude oil (CLQ13 +0.46%) this morning is up +37 cents (+0.39%) and Aug gasoline (RBQ13 +0.56%) is up +0.0155 (+0.56%). Aug crude oil and gasoline prices on Thursday fell to 1-week lows and closed sharply lower. Bearish factors include (1) dollar strength on expectations for the Fed to start reducing QE3, and (2) concerns about an economic slowdown in China after the China Jun HSBC flash manufacturing PMI fell to a 9-month low of 48.3. Closes: CLQ3 -3.34 (-3.39%), RBQ3 -0.0999 (-3.46%).

GLOBAL EVENT CALENDAR06/21/2013

US	1500 ET	May Cattle on Feed.
	1500 ET	May Cold Storage.
EUR	0400 ET	Eurozone Apr current account, Mar 24.8 billion euros and 25.9 billion euros (sa).
UK	0430 ET	UK May public sector net borrowing expected +13.5 billion pounds, Apr +8.0 billion pounds.

U.S. STOCK CALENDAR06/21/2013

Company Name	Symbol	Time	Event Description	Period	EPS Est (US$)
Darden Restaurants Inc	DRI US	Bef-mkt	Q4 2013 Earnings Release	Q4 2013	1.04
CarMax Inc	KMX US	Bef-mkt	Q1 2014 Earnings Release	Q1 2014	0.582
Darden Restaurants Inc	DRI US	8:30	Q4 2013 Earnings Call	Q4 2013
CarMax Inc	KMX US	9:00	Q1 2014 Earnings Call	Q1 2014
Walt Disney Co/The	DIS US		U.S. Box Office Release of Movie Monsters University""
Questar Corp	STR US		Roadshow - Europe - Day 5	Y 2013
Armstrong World Industries Inc	AWI US		Annual General Meeting

Enzo Biochem -- ENZ -- deleted

This morning I deleted Enzo Biochem (ENZ) from the Barchart Van Meerten Speculative portfolio for negative price trends:

• 40% Barchart short term technical sell signal
• Trading below its 20 and 50 day moving average
• Lost 14.48% in the last 30 days
• Relative Strength Index 41.28% and falling

Jim Van Meerten is a professional investor with over 40 year experience in investing in stocks, mutual funds and ETFs.  He shares his knowledge on Barchart in his daily blogs -- Barchart Portfolio Blogs.

Through Marketocracy Capital Management you can have a Separately Managed Account that mirrors his Barchart Van Meerten New High portfolio.

Enzo Biochem - ENZ - added

This morning I added a long shot, dark horse candidate Enzo BioChem (ENZO) to the Barchart Van Meerten Speculaive portfolio. The company develops, manufactures and markets health care products based on molecular biology and genetic engineering techniques, and also provides diagnostic services to the medical community. The business activities of the company are performed by one of the company's three wholly-owned subsidiaries--Enzo Diagnostics, Inc., Enzo Therapeutics, Inc., and Enzo Clinical Labs, Inc. The primary focus of the company's research is the development of products based on two technology platforms -- genetic modulation and immune modulation.


I'm calling this a speculative long shot because a lot of analysts including Value Line have beaten this stock up for a long time.  I'm only looking at the recent price momentum and one lone analyst's opinion.


Lately the stock has momentum with 16 new highs and price appreciation of 25.60% in the last 20 trading sessions.  The stock has a 96% Barchart technical buy signal and a Relative Strength Index of 68.30% that is rising.  It recently traded at 5.21 which is well above it's 50 day moving average of 4.47.


The lone analyst made a Strong Buy report based on his thoughts that sales will increase 12.50% this year and 18.20% next year.  As with most pharma companies increases in sales usually effect the bottom line very well.  He estimates an earnings per share increase of 62.70% this year, 109.10% next year and a 5 year annual EPS growth rate of 14.00%.


Some small investors have noticed these projections and the CAPS members on Motley Fool vote 63 to 9 that the stock will out perform the market with the All Stars in agreement 23 to 1.  There have only been 2 articles about the company but both have been positive.


There is a reason the portfolio is called a SPECULATIVE portfolio.  I look for momentum not fundamentals so many of the pick are undiscovered long shots and you need to do your own research before you press the buy button.

• 96% Barchart technical buy signal
• 16 new highs and up 25.60% in the last month
• Only 1 lone analysts liking this stock
• Some positive investor sentiment

Jim Van Meerten is an advisor to Marketocracy Capital Management who uses his model portfolios not only to manage their mutual funds but also their clients Separately Managed Accounts. You can read his blogs about those model portfolios and investing here and on Barchart Portfolio Blogs. Please leave a comment below or email JimVanMeerten@gmail.com.

Disclosure: Jim Van Meerten through Marketocracy Capital Management has an interest in the stocks mentioned in this blog.