We focus our attention on five notable S&P 500 stocks: Tesla (TSLA), Baker Hughes (BKR), General Electric (GE), Toll Brothers (TOL), and Samsara (IOT). Despite the mixed day on Friday, the stock market closed the week strong and these companies showed promising potential in a confirmed uptrend.
Tesla (TSLA): Accelerating in new directions
Tesla made headlines on Friday by introducing its upgraded Model 3 in China and cutting prices by nearly 20% on its high-end Model S and Model Although these announcements initially had a negative impact on TSLA, resulting in a 5.1% drop to $245.01 during trading on Friday, the stock managed to close the week with a 2.7% gain.
For potential investors looking at Tesla, it’s worth noting that the stock is currently trading near its 50-day moving average and 21-day line. An entry opportunity for more aggressive investors could arise if TSLA surpasses Thursday’s high of $261.18. According to MarketSmith, Tesla has recently formed a new base with a valid buy point of $299.29.
In the IBD automakers industry group, Tesla secures the fourth position and has a Composite Rating of 95 out of 99, a Relative Strength Rating of 84, and an EPS Rating of 93 out of 99.
Toll Brothers (TOL): Building prosperity
Luxury homebuilder Toll Brothers saw a 2.3% rise to $83.83 on Friday, clearing a buy point. Over the course of the week, Toll Brothers shares rose an impressive 8.3%. It is important to note that TOL stock had previously reclaimed the 50-day line earlier in the week.
Currently, Toll Brothers shares are trading just above a flat base buy point of $83.72, as indicated by MarketSmith. Homebuilders have performed exceptionally well this year, with rising interest rates boosting demand and raising prices for newly built homes. The broader IBD construction, residential and commercial industry group has also demonstrated strong performance in 2023, with a collective gain of over 43%.
On August 22, Toll Brothers reported better-than-expected fiscal third-quarter earnings and revenue, driven by increased home deliveries and rising unit prices. The company anticipates a continued increase in new home prices during the remainder of the year, aligning with real estate market trends.
In the Real Estate industry group, Toll Brothers secures the third position and has a strong Composite Rating of 98 out of 99, a Relative Strength Rating of 96, and an EPS Rating of 97.
Baker Hughes (BKR): advancing in oil services
Oilfield services leader Baker Hughes notched a 1.7% gain to $36.81 on Friday, contributing to a 4% weekly advance. Over the past five weeks, BKR stock has maintained a tight trading range and surpassed a $36.48 buy point on Friday.
Investors had the opportunity to identify an early entry point at $35.62, which can also be interpreted as a starting point for broader consolidation. BKR stock has shown notable gains of around 30% over the year.
Baker Hughes’ performance aligns with the strong performance of the oil and gas machinery and equipment industry group tracked by IBD in 2023, with gains of more than 27% so far this year. The company’s earnings and revenue growth has surpassed analyst estimates over the past two quarters, reflecting its resilience in the market.
BKR stock saw a breakout as U.S. oil prices soared above $85 a barrel on Friday, hitting a high for 2023. The stock has a Composite Rating of 99, a Relative Strength Rating of 92, and an EPS Rating of 91.
Samsara (IOT): Soars on Strong Second Quarter Performance
Software developer Samsara saw a notable rise of just over 13% to $30.93 on Friday, boosted by second-quarter results that beat Wall Street expectations. Over the week, IOT stock soared more than 22%, breaking out of a double bottom base with a $29.79 buy point.
While IOT stock remains within its buy range since entry, it is currently trading 18% above its 50-day line. Investors may consider monitoring Samsara for a few more days to determine if the momentum persists.
For the quarter ending July 29, Samsara reported a profit of 1 cent per share on an adjusted basis, a significant improvement compared to the loss of 4 cents during the same period a year ago. Revenue also saw substantial growth, rising 43% to $219.3 million, beating analyst projections.
Samsara’s positive quarter in adjusted free cash flow underscores its promising financial position. The stock has a Composite Rating of 96, a Relative Strength Rating of 98, and an EPS Rating of 71.
General Electric (GE): accelerating to grow
General Electric shares saw a small 0.2% decline to $114.24 on Friday, although they still managed a 2% weekly gain. The stock is currently forming a tight, flat base with a $117.96 buy point. This is the first valid base for General Electric shares since January.
In 2023, GE stock rose about 72%, outperforming many other stocks and hitting a more than five-year high. On July 25, the company delivered a strong quarterly report, with improvements evident in its aerospace, power-to-gas, and renewable energy segments. GE’s aerospace segment, often called its “crown jewel,” has played a pivotal role, contributing to the stock’s impressive earnings growth.
General Electric has consistently demonstrated its resilience, with average earnings growth of 40% over the past four quarters. Analysts expect EPS to grow 104% in the third quarter to 55 cents per share.
The stock has a Composite Rating of 92, a Relative Strength Rating of 96, and an EPS Rating of 76.
As the trading week progresses, these five stocks offer attractive opportunities for investors across a variety of sectors, potentially promising growth in the post-Labor Day market.
Also read: September Stock Market Forecast: Potential Surprises Ahead: AI, Cash and Apple in the Spotlight