S&P 500 stocks Paccar and Parker Hannifin are the focus of this week's article, as well as Monday.com (MNDY), Shopify and HubSpot.
After several weeks of gains, the stock market rallied saw modest losses in last week's results. The pullback so far has been relatively quiet. Investors should generally be cautious in making short-term purchases until there are clear indications that the pullback is winding down. It's good to watch stocks that are doing well.
Investors should prepare to quickly cut their losses and take partial profits with the current market correction. Investors should be on the lookout for a possible surge in stocks next week.
S&P 500 stocks Paccar, Parker Hannifin and Monday.com are all trading around the traditional buy point. Shopify and HubSpot also appear to be nearing actionable entry points. Some of these are further out than their 50-day moving averges and it is yet to be seen whether they will still hold up as a buy zone in the event that the market continues its downward slide.
IBD Leaderboard: SHOP stock, HubSpot and more.
S&P 500: Parker Hannifin stock
PH slipped 0.2% Friday to 370.12. The stock gained 0.3% in the past week, and 15.5% since June. According to MarketSmith, since March, the S&P500 stock has formed a base, and is only a few centimeters above an official buy point of 364.57.
Parker Hannifin's stock is up 27% by 2023 and has reached new highs. The S&P 500 stock moved decisively above its 50-day average on June 2 and then broke short-term levels by June 6. PH stock continued to race up towards the buy point but appeared extended from moving-averages. The 21-day is catching-up, but the 50 day line is still below Parkin-Hannifin stock.
Parker Hannifin is a manufacturer and supplier of motion control systems and technologies. They provide engineered solutions to a variety of markets, including mobile, industrial, and aerospace. The company operates in more than 50 countries.
The growth in earnings per share and revenue has been solid on an annual basis. This trend was accelerated during the last quarter. In the last three quarters, earnings grew by 11%, 7%, and 23% respectively. Revenue growth has also increased, going from 12% in the previous quarter to 22% and 24% this latest one.
Early August, the S&P 500 will release its fiscal fourth quarter financials. Analysts predict profits will increase 5%, to $5.44 a share, with revenues increasing 19% to $4.99 Billion.
Wall Street expects that the total revenue for fiscal year will increase 20% and EPS to $22.87 billion.
Parker Hannifin's stock is ranked third in IBD Machinery-General Industrial. It has a Composite Rating of 99 out of 100. S&P 500 has a Relative strength Rating of 90. S&P 500's EPS rating is 93.
SHOP shares gained 0.5% on Friday to 63.79, finding support near the 21-day line. The stock is down 1.4% for the week, but up 11.5% so far in June. The stock of Shopify has pulled back slightly from the 65.54 buying point after a short consolidation. It is modestly above an cup with handle base.
In June, the Canadian e-commerce services and software provider saw its stock soar. SHOP shares are also trading at 14-month-highs. They soared nearly 24% in May following the first-quarter results and announcement of the sale of its fulfillment division to privately-held Flexport.
Also, there are rumors about a possible Shopify partnership with the e-commerce titan Amazon.com (AMZN).
Shopify creates e-commerce sites for businesses. Shopify partners with Stripe for digital payments. Stripe, a fast-growing and well-funded company, has delayed its initial public offering.
Shop Pay is one of its services for merchants. Shopify offers a checkout option that is accelerated. Shopify Capital offers loans to merchants. Shop Cash rewards give consumers incentives to increase GMV by increasing orders.
Analysts expect profits to increase by 750% in 2023, from 4 cents a share last year to 34 cents a share. Wall Street predicts that sales will increase 20% in 2023 to $6.73 Billion. These consensus forecasts are now much higher.
IBD's Computer Software Enterprise industry group ranks Shopify 11th. It has a Composite Rating of 98 out of 99. SHOP has an 87 Relative strength Rating. The EPS rating is 59.
HUBS shares fell 1.2% on Friday to 512.21. HubSpot's stock gained 0.5% on the week and dropped 1.1% in June. Stock has formed a tight pattern over the past four weeks with a buy point of 535.12.
Stocks have risen by 80% since 2023. HUBS has seen its price rise steadily over the last few sessions.
HubSpot is a cloud-based platform developed by HubSpot in Cambridge, Massachusetts. It helps businesses create processes for marketing, sales and customer service.
The company reported better than expected financials for Q1. HubSpot announced first-quarter earnings of $1.20 per share, an increase of 122% over the previous year. The revenue grew 27% to $516 million.
Artificial intelligence (AI), which has been improving rapidly, is a major driver of growth in the software and tech industries. HubSpot software can benefit most from AI advancements.
Analysts predict that 2023 sales will grow 21% and profits by 74%, to $2.09 billion.
HUBS is ranked second in IBD’s Computer Software-Special Enterprises. It has a Composite Rating of 99. The stock is rated 96 relative strength. The EPS rating is 99 out 99.
S&P 500 Stock: Paccar Stock
PCAR shares rose 0.4% Friday to 78.44. The shares have fallen 0.2% in the past week, but are up 14% since June. S&P 500 is just above the flat base, with an official buy point of 76.72. The stock is in the buy range, and a little bit more strength will also break a short-term, high-handle downward trend. The current market decline increases the risk of new purchases.
Paccar's stock price has risen by more than 18% in the last six months. S&P 500 reached an all-time record high of 80.15 dollars on Thursday. PCAR traded closely around its 50-day average between March and early Juni. On June 2, the S&P500 stock moved over that important level of resistance. PCAR is 5% higher than its 50-day line.
Commercial truck manufacturer Kenworth operates under the brands Peterbilt, DAF and Kenworth. The company designs and manufactures advanced engines for diesel trucks, offers financial services and distributes parts of truck related to its core business.
Paccar has nine electric trucks in production and is working on autonomous long haul trucking.
In 2022, the S&P 500 generated revenue of $28,8 billion. Paccar's sales grew by 32% in Q1 2023 to $8 billion.
Wall Street is expecting full-year earnings per share to increase 37% to $7.91, with sales surging 16% to $31.66 Billion.
The Paccar stock ranks first in IBD’s Trucks & parts-Heavy duty industry group. S&P 500 has a Composite Rating of 92 out of 99. Stock has a Relative Strength rating of 87. S&P 500's EPS rating is 91.
MNDY shares fell 4.1% Friday to 169.52, but only marginally. This was the first time that the stock has closed below the 21-day trend line since early May 8. The stock fell 5.2% over the past week. The stock is down 5.9% after a 48% increase in May. Monday.com's stock formed a cup with a 171.89 purchase point and dropped below this key level on Saturday.
MNDY shares are up by more than 43% between 2023 and June 16, 2023, with the highest level since March 2022. On May 15, shares gapped over the 50-day mark, offering an early entry. Monday.com accelerated higher on May 23 after a short pause. The shares officially broke through on May 31 but they were much extended from the 50 day line. MNDY is still 13% higher than that level.
Monday.com, based in Israel, is a platform that lets users create their own project management and application software. The company will go public in June of 2021.
Monday.com made its first profit in Q3 of 2022. MNDY has now had three consecutive profitable quarters.
Monday.com surprised analysts by reporting a profit in the first quarter of fiscal 2023. The company also exceeded revenue and earnings estimates. The company reported EPS of $14 cents, compared to a loss of 96 cents a year earlier. Revenue grew by 49%, to $162.3million.
Analysts predict that MNDY will turn a profit every year in fiscal 2023. Wall Street expects a full-year earnings per share of 63 cents, and sales of $704,7 million.
MNDY is ranked 14th among IBD's stock group. It has a Composite Rating of 99. The stock is rated 90 for Relative Strength. The EPS rating is 93 of 99.