This week, investors should keep an eye on a select group of stocks as the market remains on an upward trajectory. Despite geopolitical tensions, particularly Israel’s military actions against Iran and its subsequent missile responses, major stock indexes have shown relatively restrained reactions, dipping around 1% in afternoon trading. The S&P 500 and Nasdaq continue their positive trends, providing fertile ground for cautious, well-researched investments.
The stocks to watch are diversified across themes such as data centers and consumer retailing, demonstrating resilience amid external uncertainties. The S&P 500 and Nasdaq’s current momentum allows for potential investments in stocks with a 21-day average true range (ATR) of up to 8%. However, investors should exercise caution to avoid over-concentration in volatile sectors.
Notable Stocks to Keep on Your Radar
MercadoLibre:
This Latin American e-commerce giant has encountered a technical support level at its 50-day moving average following a brief pullback. The stock is significantly above its 200-day moving average, indicating robust performance over the past two years. Comparisons with tech behemoths highlight its strong growth metrics, with impressive revenue and earnings increases. Recent strategic adjustments, like lowering free shipping thresholds in Brazil, aim to enhance competitiveness against market rivals, despite concerns surrounding potential impacts on gross margins.
Credo Technology Group:
Specializing in AI data centers, Credo is solidifying its presence with a cup-and-handle formation around a notable buy point. With high-profile clients, including well-known cloud service providers, the company is poised for substantial growth as demand for data throughput surges. Analysts project significant increases in quarterly sales and earnings, indicating a strong outlook for its innovative solutions.
Brinker International:
As the parent company of popular dining chains like Chili’s and Maggiano’s, Brinker is navigating a tough market with a value-based strategy that positions it favorably against competitors. Despite initial skepticism following previous earnings reports, a strong rebound in stock price shows resilience, driven by impressive earnings and sales growth. The company’s ability to adapt to changing consumer behaviors and competitive pressures is evident in its performance.
Quanta Services:
This firm, heavily involved in utility construction and renewable energy projects, continues to benefit from growing demand for infrastructure capable of supporting expanding data centers. After a recent cup-and-handle breakout, Quanta’s strong position in essential services makes it a key player in the energy and tech intersection, showcasing favorable metrics that suggest robust future performance.
Sportradar Group:
Positioned within the gaming data sector, Sportradar is pursuing new partnerships to expand its influence in the sports betting landscape. While the company has demonstrated profitability, its earnings growth has lagged behind its sales trajectory. The establishment of exclusive partnerships for broadcasting betting data signifies growth opportunities, although its current composite rating reflects challenges that may temper investor enthusiasm.
In Summary
As the market responds to global events, a varied portfolio can help mitigate risks while participating in growth opportunities. These stocks represent a mix of sectors, each with unique advantages and potential challenges. Keeping a close watch on their performance could yield promising results as the landscape continues to evolve. Investors should remain vigilant, evaluating each stock’s fundamentals alongside the broader market trends to inform their decisions.
