Costco stock — along with Taiwan Semiconductor Manufacturing, which makes chips for Nvidia — and Magnificent Seven member Amazon.com headline Wednesday's Screen Of The Day, a column crafted from the IBD Stock Screener.
Wednesday's picks come from the Stocks Funds Are Buying screen, which identifies companies with increasing fund ownership in the past few quarters.
Nvidia Chipmaker Eyes Buy Point
Taiwan Semiconductor, better known as TSMC, is the world's largest chip foundry. Its big-name customers include Apple, Nvidia, Advanced Micro Devices, Qualcomm and Broadcom.
Forget Amazon And Tesla. This Non-Magnificent Seven Stock Is Soaring.
Taiwan Semi is forming a cup-with-handle base that displays a 175.45 buy point, per IBD MarketSurge. Shares are fighting to hold support around the 50-day moving average; they fell 0.8% Wednesday.
In the latest quarter, TSMC beat estimates for the second quarter and guided above views for the current period. The company earned $1.47 per U.S. share on sales of $20.7 billion in the June quarter. Analysts polled by FactSet had expected earnings of $1.41 a share on sales of $20.33 billion. On a year-over-year basis, TSMC earnings increased 31% while sales rose 34%.
Nvidia earnings are due out late Wednesday. Those results will surely impact TSMC, along with much of the tech sector. Wall Street expects Nvidia to earn 65 cents per share on revenue of $28.7 billion, according to FactSet.
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Costco Stock Hits Entry
Retail giant Costco is attempting to break out past an 896.67 buy point in a cup base following Tuesday's advance. The 5% buy zone goes up to 941.50. Costco stock moved down 2.3% Wednesday, back below the buy trigger.
Bullishly, the stock's relative strength line made a new high on the breakout day. That reiterates Costco stock as a market leader.
Up next, Costco will report August sales on Sept. 5. The next quarterly earnings report is due out Sept. 26. Wall Street expects the company to earn $5.07 per share on sales of $80.2 billion.
Amazon Hits Resistance
Magnificent Seven stock Amazon plunged below its 50- and 200-day lines on Aug. 2 following the company's second-quarter earnings report. After rebounding for several weeks, shares found resistance at their 50-day line on Aug. 21. Now, shares are once again testing their 200-day average.
Amazon stock is building a new base, but there isn't a clear buy point at this time. If the stock is able to move further up the right side of the base, that would provide more clarity on the stock's prospects.
Amazon shares dropped 1.3% Wednesday.
Follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on Arm stock, other best stocks to buy and watch and the Dow Jones Industrial Average.
