AI stocks Nvidia and Snowflake lead this week's top stocks to watch near buy points. Mastercard also makes the cut. So do Booking Holdings and United Rentals.
NVDA stock and SNOW stock are within striking distance of buy points. Booking and United Rentals are in buy range after clearing entries. MA stock is signaling an early entry as it works on a traditional buy point.
Nvidia, Booking and SNOW stock earn a place on the IBD 50 list of top growth stocks. NVDA stock also finds a spot on the IBD Leaderboard while Booking stock is on the leaders watchlist. Both Nvidia stock and BKNG stock are on the IBD SwingTrader as well.
Relative Strength Is Key
Most of these top stocks have rising or improving relative strength lines. A rising RS line means that a stock is outperforming the S&P 500.
The stock market continues to rebound in December from the summer sell-off, lifting these and other top stocks near buy points.
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Nvidia Stock: Top AI Stock
Shares of the AI chip leader are trying to regain a double-bottom buy point after finding support at the 10-week moving average.
Nvidia stock rose 1.6% for the week to 475.06. That's still shy of the 476.09 buy point, but NVDA did clear the 21-day line and broke a short downtrend, offering a slightly early entry.
Nvidia stock first cleared the official buy point in early November, reaching a record 505.48 on Nov. 28.
But NVDA stock stumbled after its latest quarterly earnings report, due in large part to worries about AI chip exports to China.
The RS line for Nvidia stock is near a record high but still below the consolidation high.
Nvidia screens well in terms of key IBD ratings. It earns an IBD Composite Rating of 98, EPS Rating of 99 and RS Rating of 97, all out of a best-possible 99.
The 97 Relative Strength Rating means that NVDA stock has outperformed 97% of all stocks in IBD's database over the past 12 months for price performance.
On Nov. 21, Nvidia disclosed earnings rocketed 593% in the third quarter and revenue soared 206%. Nvidia earnings growth accelerated from the prior quarter. Sales growth also sped up sharply from a 102% gain in the previous quarter. In Q3, data-center revenue surged 279%. The business includes the A100 and H100 AI chips for artificial intelligence (AI) applications.
Nvidia will face more intense competition. Advanced Micro Devices formally unveiled an AI chip lineup on Wednesday.
Snowflake Stock
Another top AI stock, Snowflake eyes a 192.66 cup-with-handle buy point.
SNOW stock rose Friday to within 1% of the entry, up 2.5% to 190.67 for the week.
The RS line is back near the consolidation high, a positive sign ahead of a breakout. The RS line remains far below its 2020 high.
Snowflake stock holds a Composite Rating of 96, EPS Rating of 82 and RS Rating of 90.
Earnings more than doubled in the last quarter and are on track to more than triple for the full fiscal year, which ends in January, FactSet shows.
Snowflake provides cloud data warehousing software. It came public in September 2020.
SNOW was Friday's IBD Stock Of The Day.
Booking Stock
Shares of the travel booking site topped a 3,207.32 handle buy point Thursday, then hit a record high Friday. BKNG stock rose 3.65% for the week to 3,275.
The RS line is trending higher but still below the May 2018 high.
Booking stock bears a Composite Rating of 98, EPS Rating of 77 and RS Rating of 91.
Earnings growth is slowing, though still a robust 36% in the latest quarter.
The company is benefiting from strong travel demand despite an uncertain economy. Its brands include Booking.com, priceline.com and Kayak.com.
United Rentals Stock
Shares of the construction equipment rental firm popped back into the buy zone Friday. URI stock fell 1.35% to 495.06 for the week, but climbed 1.6% on Thursday and 2.3% on Friday.
United Rentals stock first cleared the 488.73 cup-with-handle buy point on Dec. 1.
The RS line is trending higher and near the consolidation peak. But it's still below the February 2023 high.
URI stock carries a Composite Rating of 96, EPS Rating of 96 and RS Rating of 85.
United Rentals' EPS growth ranged between 27% and 39% in the first three quarters of 2023. Its sales growth was also robust, partly reflecting the Ahern Rentals acquisition, which was finalized at the end of 2022.
More broadly, United Rentals stock continues to benefit from the $1.2 trillion infrastructure spending bill passed in November 2021.
There's also market momentum for industrial, construction and infrastructure stocks.
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Mastercard Stock
Shares of the credit card payment play fell 0.5% to 412.16, finishing near weekly highs.
Mastercard stock has a flat base according to MarketSmith pattern recognition, giving it a 418.60 buy point. Investors could view the consolidation as a V-shape cup-with-handle base, with a 416.60 buy point.
On a weekly chart, MA stock has a three-weeks-tight with that same 416.60 entry.
The rising RS line is not far from all-time highs, but below the consolidation peak.
Mastercard stock owns a Composite Rating of 86, EPS Rating of 93 and RS Rating of 79.
It shows accelerating earnings growth, capped with a 27% gain in the latest quarter. Resilient consumer spending on travel and entertainment has boosted growth.
Two weeks ago, Mastercard won long-awaited approval to expand its offerings in China's huge payments market, reports said.
MA stock roared back from a steep sell-off after its Q3 results in late October, just as the overall market began to rebound.
Unlike the other stocks on this list, Mastercard's RS line hasn't made a lot of progress over the past several weeks.
