The Nasdaq, S&P 500 and the Dow Jones Industrial Average all notched their best week of the year as some constructive economic news helped kick the stock market back into a confirmed rally. IBD methodology says that means leading stocks that built bases during the market’s pause are now fair game for growth stock investors.
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Can This Cybersecurity Stock Benefit From CrowdStrike Debacle? Upcoming Earnings May Tell.
While the Dow has now largely finished its reporting season, retail earnings continue apace this week with Target (TGT), Burlington Stores (BURL), TJX (TJX) and Ross Stores (ROST) among the names to watch. Baidu (BIDU) heads up a heavy contingent of reports from China-based leaders. Toll Brothers (TOL) highlights a big week for the real estate industry. And Wyoming will once again become the center of the financial world for a few brief days as the world’s top central bankers soak in some of the opulent U.S. natural beauty surrounding Jackson Hole.
Stocks To Watch: Five Stocks Near Buy Points
After posting its strongest week of the year, the market is now back in a confirmed uptrend. So investors should be looking for stocks in or near buy zones. Comfort Systems (FIX), Costco Wholesale (COST), Wingstop (WING), Broadcom (AVGO) and AppLovin (APP) represent a broad array of watchlist-worthy leaders. Comfort Systems, a heating and cooling company that’s AI-adjacent, is setting up in a base and sitting on a year-to-date gain of 61%. Retailer Costco, with a 32% gain, is also basing. Wingstop, Broadcom and AppLovin — three very different companies — are all near early entries around their 50-day lines after acing quick rebounds from support at their 200-day moving averages.
Powell Due After Best Week Of 2024; Three AI Stocks Near Buy Points
Economic Calendar: Focus On Jackson Hole
The gathering of central bankers and economists in Jackson Hole, Wyo., for the Kansas City Federal Reserve’s annual economic symposium, which runs Thursday through Saturday, is likely to dominate the coming week’s economic news. Fed Chair Jerome Powell, set to speak Friday morning, is generally expected to signal a 25-basis-point cut to the federal funds rate in September. Markets, however, figure almost a 26% probability of a half-point decrease. The actual size of the cut is likely to be determined by the Labor Department’s August payrolls report, due Sept. 6. A cut of any size would mark the first decrease since the 100-point cut to between zero and 0.25% in March 2020.
Homebuilders: A Critical Week For Real Estate
As the real estate industry faces its first week under the new rules governing the relationship between consumers and agents, some key data points as well as earnings from Toll Brothers and Hovnanian (HOV) are due. Toll Brothers, on Wednesday, is expected to see earnings dip and sales growth slow to 1%. Investors so far this year have driven Toll shares up 40%, and the prospect of a September rate cut and easing mortgage rates suggests the market could be about to improve. July existing home sales on Thursday, and new home sales Friday, could also provide perspective. Sales of existing homes have declined since February. New home sales have been choppy for more than a year.
Cybersecurity: Can Palo Alto Revive Its Rally?
With security center stage in the recent news, Palo Alto Networks (PANW) delivers fiscal Q4 earnings late Monday. Analysts expect a 2% EPS slip and an 11% rise in revenue, to $2.16 billion. The company is expected to provide fiscal 2025 revenue and EPS guidance. The cybersecurity stock has notched a 12-month gain of 56%. But it is 12% off a February high.
Retail Earnings: Target Aims For A Hot Q2
The late-season rollout of retail earnings continues in the coming week, with Target, Lowe’s (LOW), Urban Outfitters (URBN), Macy’s (M) and Burlington Stores, among others, providing a sense of the range of stores set to report. Target and Burlington are expected to see earnings jumps of 22% and 56%, respectively. Lowe’s losing streak is seen continuing. Analysts project Urban Outfitters’ first earnings slip in six quarters. A decent earnings report sent Walmart nearly 8% higher in the past week.
Discount Retail: Selling Into Consumer Stress
Discount retailers TJX reports early Wednesday, followed by Ross Stores on Thursday. Telsey Advisory on Friday said TJX carries momentum from a strong start to the year into Q2, as consumers continue to pursue value. Analysts expect earnings to increase 8% to 92 cents per share for the quarter on 4.3% revenue growth to $13.3 billion. TJX stock is perched in a three-weeks-tight pattern. FactSet expects Ross earnings to increase nearly 13% on 6.3% revenue growth. ROST stock rebounded above its 50-day line on Thursday and is approaching its record high from mid-July. Retail peer Dollar Tree (DLTR) rallied 5.2% Thursday, notching its largest daily gain since October 2023.
Overseas Stocks: A Busy Week For China Names
Chinese search giant Baidu reports on Thursday. Analysts see a 17% earnings drop, while sales are expected to rise less than 1%. U.S.-listed Baidu stock is down 26% this year. Video game publisher NetEase (NTES) will also report Thursday, with EPS expected to decline 14%. Sales are seen rising 8%. NetEase U.S.-listed shares are down 4% year-to-date. Vipshop (VIPS), a Chinese e-commerce company, is also expected to post an earnings decline.
Stocks Market Earnings Bullets
Estee Lauder (EL) reports for its fourth quarter early Monday. Analysts expect earnings per share to rebound 279% as revenue grows 5%. That would mark the second straight quarter of recovery after a severe seven-quarter decline. Analysts predict a huge rebound from a two-year slump. The stock remains below key support levels, down more than 34% this year.
Fabrinet (FN) will report results for its fiscal Q4 late Monday. Analysts expect the contract electronics manufacturer to earn $2.24 a share, up 20% year over year, on sales of $733 million, up 12%.
Alcon (ALC) delivers fiscal third-quarter earnings early Wednesday. Analysts expect the medical products company to earn an adjusted 75 cents per share on $2.62 billion in sales. Both metrics would rise roughly 9%. Alcon stock broke out of a flat base in late July. Shares are lingering on the edge of the buy zone.
Dycom Industries (DY) releases its Q2 results early Wednesday. The telecom infrastructure play is seen earning $2.26 a share, up 11%, on sales of $1.2 billion, up 15%. Shares have just cleared a buy zone and are up 68% this year.
Synopsys (SNPS) posts fiscal third-quarter results late Wednesday. Wall Street predicts the chip designer will earn $3.28 a share, up 14%, on sales of $1.52 billion, up 2%.
Intuit (INTU) serves up its fiscal Q4 report late Thursday. Analysts see the financial software firm earning $1.85 a share, up 12%, on sales of $3.08 billion, up 14%. Intuit stock is in a cup-with-handle base.
Cava (CAVA) reports Q2 results late Thursday. FactSet expects earnings to fall 38% to 13 cents per share adjusted on 26% revenue growth to $218.5 million. Same-store sales at the Mediterranean restaurant chain are seen rising 7.5%, slowing from 18.2% growth last year. The stock is trading near record highs from early July.
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