When the market is facing uncertainty and changing trends, finding top performing stocks can help identify new leaders. In today's IBD's Screen of the Day, the focus is on stocks with a relative strength line at all-time highs.
Three stocks are nearing buy points, which makes the behavior of their RS lines look bullish.
Data storage company Pure Storage has been trading sharply higher. The company reported strong fourth-quarter earnings, which saw earnings of 36 cents a share beat analyst estimates of 26 cents. Revenue of $708 million also beat estimates.
Shares rallied almost 13% March 2 on the news and have since continued higher as the company nears its 35.19 buy point in a cup base.
Buzz about Pure Storage also increased with the January announcement of a partnership with the Facebook business of Meta Platforms to develop the metaverse in Facebook's AI Research Supercluster. Under the agreement, Pure Storage will help provide digital storage solutions for the metaverse.
Pure Storage is currently the leader in the computer data and storage group. The company boasts an IBD Composite Rating of 97 and EPS Rating of 98.
Leading Stock Archaea Energy Reports Earnings, Strong Guidance
For investors keen on renewable energy, Archaea Energy fits the bill. The company is one of the largest renewable gas producers in the U.S. focused on transforming landfill waste into clean energy. Archaea Energy reported fourth-quarter earnings on March 17 with revenue of $57 million and EBITA of $16.4 million.
Archaea Energy was unprofitable, with a full-year loss of 49 cents a share in 2021. Nevertheless, shares traded higher on the report due to strong guidance and expected profitability. Earnings were forecast at 64 cents a share for 2022.
Archaea Energy stock is forming a cup base and has a buy point of 22.11, according to MarketSmith pattern recognition.
Arthur J. Gallagher Leads on Impressive Growth
Insurance broker Arthur J. Gallagher is also performing well, with a relative strength line at new highs as the stock forms a base.
Results have been strong, with EPS growing from $4.81 in 2020 to $5.48 this past year. Strong global growth out of the Covid pandemic is expected to continue, with EPS increasing to $6.92 and $7.74 in 2022 and 2023, respectively.
Arthur J. Gallagher has continued to expand through acquisitions, most recently acquiring Washington-based insurance broker Hawley & Associates on March 10.
A leading stock also, Arthur J. Gallagher stock is forming a cup base with a 171.31 buy point.
