Tracking institutional flow can give you an idea of what the prominent fund managers are thinking. In today's IBD Screen of the Day, we look at the top stocks — energy stocks in particular — that funds are buying.
Energy stocks are dominating the list likely due to their hedge against inflationary risks as well as strong fundamentals and growth. Specifically, natural gas transporters have been accumulated, as institutions look to a potential natural gas crisis in Europe as fall approaches. Here are some of the top names to keep an eye on.
Natural Gas Supply Bottlenecks Aid Energy Stocks
After breaking out of a cup base, New Fortress Energy is soaring over 4% higher today, hitting a buy point of 52.47. The breakout comes as shares are trading with a relative strength line at new highs.
The company — which offers natural gas storage, processing and shipping facilities — reported strong second-quarter results last week. EPS was reported at 69 cents on EBITDA of $283 million. On the same day, New Fortress announced a partnership with Plug Power to build a 120-megawatt hydrogen power plant near Beaumont, Texas. This announcement continues the company's commitment to a transition to clean energy.
Flex LNG, highlighted last week as a top global stock, is also on the radar for funds as it continues to trade in a cup base, nearing a 33.46 buy point.
The company — headquartered in Bermuda — is ranked second in IBD's oil and gas transportation group, which ranks 21st out of 197 industries.
Funds Accumulate Top Automotive Service Stock
The automotive service industry has been hot as higher prices and a limited supply of new vehicles have driven up demand. Headquartered in Charlotte, N.C., Driven Brands has been a top fund favorite.
The company — providing automotive services including collision repair, paint, glass replacement and oil changes — reported strong second-quarter results on July 27. Adjusted EPS came in at 35 cents with revenue of $508.6 million. Furthermore, Driven Brands raised its guidance and is now projecting earnings of $1.17 for the year on revenue of $2 billion.
Shares of Driven Brands are forming a cup base with a 34.72 buy point, per MarketSmith pattern recognition.
