Navellier Top 5 for September

The following is provided by Navellier with technical comment from South Ocean Management – pls do your own due diligence.
(For this 2020 year, SOM will track only the Top 5 Hi-Growth Investments.)

https://navelliergrowth.investorplace.com/

Navellier says,

High-Growth Investments

DocuSign, Inc.

DocuSign, Inc. (DOCU) has earned its spot on the Top 5 Stocks list for the third-straight month, thanks to strong institutional buying pressure and triple-digit forecasted earnings growth. The reality is that the company has experienced a massive surge in demand for its cloud-based platform that enables businesses and individuals to develop, upload, sign and send agreements and documents virtually.

Its e-signature technology can be easily integrated with several solutions, including Salesforce and Workday. So, it’s been a popular resource in the current work-from-home climate.

DocuSign will release second-quarter results after the stock market closes on Thursday, September 3. The consensus estimate calls for earnings of $0.08 per share, which represents 700% annual earnings growth. Second-quarter revenue is forecast to jump 35.2% year-over-year to $318.57 million, up from $235.6 million in the same quarter a year ago.

Analysts’ earnings estimates have remained relatively steady over the past three months, but DocuSign has posted an average 142% earnings surprise in the past three quarters. So, I wouldn’t be surprised if DocuSign tops analysts’ estimates again. DOCU is a Moderately Aggressive buy below $243.

SOM Technicals:

6-26-20: Closed at 177.58. Trade pressures are up. Volumes are bullish. This spike up is not likel;y to continue in the face of the sell off.

7-4-20: Closed at 190.99. Trade pressures are up. Volumes are bullish. This parabolic move is very uncomfortable.

7-10-20: Closed at 210.11. Trade pressures are up but reversing. A close below 210 would signal lower.

7-18-20: Closed at 196.42. Trade pressures are down but rising. Volumes are neutral. The next target up is 217.

7-24-20: Closed at 190.95. Trade pressures are down. Volumes are bearish. The next target down is 172.23.

7-30-20: Closed at 217.45. Trade pressures are up. Volumes are bullish. The next target up is 257.20.

8-7-20: Closed at 205.00. Trade pressures are down. Volumes are bearish. Dropped thru two downside targets this week. The next target down is 185.06.

8-15-20: Closed at 199.71. Trade pressures are neutral. Volumes are neutral also. Traded down near the 185.06 target and now has moved higher. At the 25×5 MA and looks lower. The next target don is the 185.91 Target.

8-21-20: Closed at 210.18. Trade pressures are up but showing reversal. Volumes are bullish. The next target up is 221.00.

8-29-20: Closed at 215.24. Trade pressures are up. Volumes are bearish. resistance here at the 217.23 level, which is also the new long entry.

9-5-20: Closed at 216.26: Trade pressures are down. Volumes are bearish. Sitting on the 25×5 MA support at 216.

9-12-20: Closed at 197.94. Trade pressures are down. Volumes are bearish. A close below 196.53 triggers a new short entry.

9-19-20: Closed at 194.42. Trade pressures are down. Volumes are neutral. The next target down is 173.35.

 

 

The Kroger Company

The Kroger Company (KR) is one of the biggest food manufacturing businesses in the U.S., and we added it to the High-Growth Investments Buy List in the August Monthly Issue. Kroger has benefited from the global pandemic, as it has driven more Americans to its online platform, physical stores and pharmacies. And more folks are likely to be knocking down its door, as the company announced recently that it was providing COVID-19 testing at all of its clinic locations.

Kroger is expected to announce second-quarter results in early September. Given strong demand for its services and groceries, the analyst community has upped its earnings forecasts over the past three months. The current consensus estimate calls for second-quarter earnings of $0.50 per share and total sales of $29.62 billion, which represents 5.2% annual sales growth and 13.6% annual earnings growth.

Kroger also continues to reward its shareholders. The company will pay a quarterly dividend of $0.18 per share on Tuesday, September 1. All shareholders of record on August 13 will receive the dividend. The stock has a 2.0% dividend yield. KR is a Conservative buy below $38.

SOM Technicals:

Closed at 35.30. Trade pressures are down. Volumes are bearish. The next short entry is 34.51.

9-5-20: Closed at 35.47. Trade pressures are down. Volumes are bearish. New short entry at 34.84.

9-12-20: Closed at 34.30. Trade pressures are down. volumes are bearish. The next target down is 31.34.

9-19-20: Closed at 33.21. Trade pressures are down but rising. Volumes are bearish. Resistance at 35.08 and the next target down is 31.34.

 

Quidel Corporation

Quidel Corporation (QDEL) is making its second-straight appearance on the Top 5 Stocks list since we added it to the High-Growth Investments Buy List in the July Monthly Issue. The company focuses on developing diagnostic tests in the healthcare field, so its business has been booming amidst the coronavirus pandemic.

In fact, Quidel received an emergency use authorization (EUA) from the FDA for its SARS-CoV-2 test, Sofia 2 SARS Antigen FIA. After the nasal swab has been taken from a potential patient with COVID-19, the test takes approximately 15 minutes to run. I should also add that Quidel’s Lyra Direct SARS-CoV-2 assay received Health Canada authorization recently, and the test can now be used in Canada to test for the coronavirus. Needless to say, demand for Quidel’s products remains strong.

Now, as I noted in my August 27 update, QDEL pulled back sharply on Thursday, and the reason why is two-fold. First, the CDC announced this week that it had adjusted its guidelines for the testing of COVID-19. The agency will now exclude individuals who do not have symptoms of the virus. And, second, Abbott Laboratories (ABT) received an EUA from the FDA for its 15-minute COVID-19 test.

Clearly, Wall Street thinks the CDC’s recent announcement and Abbott Labs’ test will cut down on demand for Quidel’s COVID-19 tests. But I think these fears are overblown. With colleges and universities reopening their doors to students in recent weeks, many are requiring COVID-19 tests for students and professors who will be on campus. So, I suspect that demand for Quidel’s COVID-19 tests will remain in top demand for the foreseeable future.

I’m not alone in this thinking. The analyst community has upped their third-quarter earnings forecasts by a whopping 456% in the past three months. Third-quarter earnings are now expected to surge 480% year-over-year. And the company has posted a positive earnings surprise for three-straight quarters. So, I view this week’s dip as a good buying opportunity. QDEL is an Aggressive buy below $187.

SOM Technicals:

7-30-20: Closed at 282.47. Trade pressures are up. Volumes are bullish. The next target up is 367.57.

8-7-20: Closed at 272.76. Trade pressures are down. Volumes are bearish. The next target down is 259.83 the 25×5 MA.

8-15-20: Closed at 245.93. Trade pressures are up. Volumes are bearish. At the 25×5 MA. Should act as resistance. The next target down is 215.00.

8-21-20: Closed at 241.52. Trade pressures are in the neutral zone. Volume are bearish. Appears to want to test the 200.00 support level.

8-29-20: Closed at 162.97. Trade pressures are down hard. Volumes are neutral, short covering? The 200 day MA held as support. A close above 188.83 is the new long entry.

9-5-20: Closed at 154.41. Trade pressures are down. Volumes are bearish. 200 day MA is holding as support.

9-12-20: Closed at 161.19. Trade pressures are rising into the neutral zone. Volumes are now bullish. A close above 188.63 would signal higher.

9-19-20: Closed at 188.50. Trade pressures are up. Volumes are bullish. Has triggered a new long entry. The next target up is 248.00.

 

West Pharmaceutical Services, Inc.

West Pharmaceutical Services, Inc. (WST) was one of our new additions to the High-Growth Investments Buy List in the August Monthly Issue. You may recall that West Pharmaceutical Services manufactures quality containment, packaging and drug delivery products at its nearly 50 locations around the world. The company manufactures more than 100 million components each day.

With several biotechs and biopharmaceutical companies developing vaccines and treatments for the coronavirus, West Pharmaceutical Services experienced an increase in demand for its high-value products. The company reported that second-quarter sales rose 12.2% year-over-year to $527.7 million, while adjusted earnings soared 40% year-over-year to $1.25 per share.

Analysts expect product demand to remain strong in the current quarter, as evidenced by the recent earnings revisions. The current consensus estimate calls for earnings of $0.99 per share, up from previous forecasts for $0.84 per share just two months ago. Analysts also expect sales to grow 12% year-over-year to $510.68 million. WST is a Conservative buy below $293.

SOM Technicals:

Closed at 271.32: Trade pressures are down. Volumes are bearish. The next target down is 253.48.

9-5-20: Closed at 263.66. Trade pressures are down. Volumes are bearish. Next target down is 256.43.

9-12-20: Closed at 272.41. Trade pressures are up but rolling over. Volumes are bearish. At the 25×5 resistance now – 273.

9-19-20: Closed at 277.73. Trade pressures are down but rising. Volumes are bullish. Back testing the 25×5 resistance at 277 now.

 

Zoom Video Communications, Inc.

Zoom Video Communications, Inc. (ZM) is gearing up for a blowout second-quarter earnings report on Monday, August 31. The company’s business has been booming in 2020, as Zoom is a leading provider of online video and audio conference calls, as well as collaboration, chat and webinar tools. With much of the country working remotely during the pandemic, its platform has been in top demand, which should be apparent in the second-quarter results.

For the second quarter, earnings per share are expected to surge 462.5% year-over-year to $0.45, up from $0.08 per share in the same quarter a year ago. Analysts have also upped earnings forecasts by a whopping 309% in the past three months. Typically, positive analyst revisions precede future earnings surprises.

I should add that Zoom has posted an average 284% earnings surprise in the past four quarters. So, another stunning earnings surprise is likely on Monday afternoon. The company is also expected to report second-quarter revenue of $500.45 million, up 243.2% from the $145.8 million achieved in the second quarter of 2019. ZM is an Aggressive buy below $360.

SOM Technicals:

7-30-20: Closed at 253.91. Trade pressures are down but rising into the neutral zone. Volumes are bearish. The next target down is 209.79.

8-7-20: Closed at 258.73. Trade pressures are down. Volumes are Bearish. The next target down is 239.12.

8-15-20: Closed at 244.91. Trade pressures are up. Volumes are bearish. Rising into net bearish volumes after reaching the 227.53. target. Need to get thru the 25×5 MA at 254.63, otherwise more downside.

8-21-20: Closed at 289.68. Trade pressures are up and trending. Volumes are bullish. The resistance was non- existent. A new long entry was triggered at 271.00.

8-29-20: Closed at 299.27. Trade pressures are up. Volumes are bullish. The next target up is 314.82.

9-5-20: Closed at 369.89. Trade pressures are down into the neutral zone. Volumes are bullish. The next target down is 314.78 which would close the gap up. 

9-12-20: Closed at 383.00. Trade pressures are now up. Volumes are bearish. A close below 376 would signal a new leg down.

9-19-20: Closed at 438.73. Trade pressures are up. Volumes are bullish. In the new move after a back test to try to close the gap a t 345. The next target up is 470.76.

 

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