Stocks to buy that are approaching buy points

As the stock market tried to rebound last week, there were several IBD 50 stocks to buy that broke above buy points or formed new bases and approached buy zones. Among these stocks is a manufacturer of medical devices medical shock wave (SWAV), gasoline and convenience store operator United States (MUSA), chip equipment marker Axcelis Technologies (ACLS) and manufacturer of roofs and braking systems Carlisle (CSL).


These stocks are more than likely to capture this week’s 2% gains in the S&P 500 and reach new highs.

Shockwave Medical is a good example of a stock that forms a base cut with the underpinnings of a rising relative strength line and support at its 50-day moving average and 200-day moving average. This IBD 50 Stock to Watch pick is around 8% below a buy point of 223.25.

SWAV has all the ingredients for a stock to buy

Analysts estimate SWAV earned 44 cents per share on sales of $107.5 million in the second quarter, compared with a loss of 1 cent a year earlier. The company is due to announce its results on August 8.

Shockwave is #3 in IBD’s group of 75 medical systems/equipment. Rated by Relative Strength Rating, it ranks behind the manufacturer of radiation devices Sensus Health (SRTS) and Blood System Developer Hemonetics (EDT), according to IBD Stock Checkup. The group is ranked No. 24 among 197 industry groups.

Murphy USA is trading in a buy zone after breaking above a third leg consolidation buy point of 262.68 on July 11th. Since then, it has hovered around this level or higher. Second quarter results are expected on July 27. Analysts expect MUSA to earn $5.35 per share, up 12% from $4.79 a year earlier.

Axcelis is another stock that is trading within a basis, but is 16% below a buy point of 83.83, according to chart analysis by MarketSmith.

The stock ended down almost 5% on Friday. Still, Axcelis stock is trading above its 50- and 200-day averages and has a high relative strength rating of 98.

Carlisle and SolarEdge also offer buying opportunities

A better buying opportunity might be Carlisle, which is within 3% of a buy point of 272.68 from a double-bottom base. The stock is trading above its 50 and 200 day lines.

With first-quarter earnings growth of 209% under its belt, analysts expected Carlisle to post $5 EPS, a 131% increase, when it reports next week. CSL stock has also earned a spot on the latest list of new buys by top mutual funds. And it sports a Blue Dot relative strength line on its MarketSmith stock chart.

A fifth stock that is also worth mentioning is SolarEdge Technologies (SEDG). It is a solar energy stock based in Israel. The stock formed a nice cup-and-handle base with a buy point of 314.62. It is trading above its 50-day line and at its 200-day moving average. The only caveat to this stock is that it is lightly traded and over the past two weeks has not reached its 50-day moving average of trading volume.

Follow Michael Molinski on Twitter @IMmolinski


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