One easy way to find top-notch growth stocks is to use the IBD Stock Screener. Tuesday's "Stocks Funds Are Buying" screen finds stocks meeting stringent IBD criteria with mutual funds adding shares.
The "I" in the IBD CAN SLIM investing strategy stands for Institutional Sponsorship. Increased mutual fund ownership shows that big money managers have conviction in a stock's upside price potential.
Of the 19 stocks selected in today's screen, we highlight several in varying industries hitting buy points.
Stock Screener Highlights Chip Products Stock
Microchip Technology stock is in the 5% buy zone reaching to 92.15 of an undefined base with an 87.76 buy point, according to MarketSmith pattern recognition. Shares hit the buy point on June 30, as chips stocks rallied.
MCHP jumped on July 3, on news of a $300 million multiyear expansion into India. The stock bumped higher after the company announced its new automotive Ethernet systems on July 13.
Quarterly earnings growth decelerated to 21% in its March-ended quarter, from 30% and 36% in the prior two quarters.
Full-year analysts' EPS projections show a 3% dip in fiscal 2024, but that comes after a 30.6% increase in 2023.
Mutual funds own a high 58% of the stock, with 2,446 funds owning shares in June, up from 2,399 in March and 2,268 in December.
Shares of Salesforce are in the buy zone reaching to 236.25, after CRM broke out of a flat base and hit the 225 buy point.
The IBD 50 stock popped 3.9% on July 11, after the company announced its first price increase in seven years. Shares jumped another 2.8% the following day and hit the buy point.
Mutual funds own 48% of the customer relationship management stock, with 4,352 funds owning shares in June, up from 4,284 in March and 4,141 in December.
Analysts project full-year fiscal 2024 EPS growth of 24% and 19% in 2025. Salesforce holds near-perfect 98 IBD Composite and EPS Ratings.
Fintech Stock Jumps On New Partnership
Fiserv stock is bumping against the upper reaches of a buy zone reaching to 128.51. FI tapped the 122.39 buy point of a flat base after the company announced on June 27 that it partnered with leading India-based financial company Tata Motors Finance.
Shares got another lift on July 10, after the company rolled out its real-time risk scoring capabilities to financial institutions.
Funds own 55% of FI, with 2,587 funds owning the fintech stock in June, up from 2,547 in March and 2,519 in December. Analysts expect 14% full-year EPS growth this year and next.
Stock Screener Selects Travel Stock
Lastly, Airbnb shares hit the 144.63 buy point of a cup base on Monday, and are in the buy zone stretching to 151.86.
ABNB soared 4.4% on July 11 in heavy volume, after Needham raised its price target to 160 from 150 and maintained its buy rating. Other analysts quickly followed suit with price hikes.
Travel stocks have outperformed as people are eager to resume vacations after the pandemic pause. Shares of the online stay and experience platform stock have gained nearly 70% year to date.
Analysts forecast hefty 61% full-year EPS growth this year and 12% next year.
Funds own 42% of ABNB, with 1,865 funds owning the stock in June, up from 1,853 in March, and 1,740 in December.
Follow Kimberley Koenig for more stock market news on Twitter @IBD_KKoenig.
