Finding winning growth stocks to buy can be a challenge, but the Relative Strength Blue Dot stock screen in IBD MarketSmith quickly identifies emerging leaders. It's no surprise that NVDA stock appeared on the list of 70 names, but two others are worth highlighting.
The stock screen is part of the MarketSmith reports, and lists all stocks that had a blue dot on their chart at the time of the screening.
The dot marks stocks whose relative strength line is at new highs while the stock is near a buy point or while forming a base. That's a bullish combination. (The RS line compares a stock's price performance with that of the S&P 500 on daily and weekly charts.)
NVDA Stock Hits New High
Nvidia continues to outperform the S&P 500 by a long shot. The Magnificent Seven stock gained over 230% over the past year, while the S&P 500 has gained around 19%.
The IBD 50 stock is extended from a flat base with a 505.48 buy point. NVDA stock broke out of the base on Jan. 8 in heavy volume, and climbed to yet another all-time high on Tuesday. The AI-chip maker's fiscal 2024 earnings are expected to grow a whopping 241% in the fiscal year ending this month, and 69% in the next fiscal year, per MarketSmith. Nvidia continues to lead in the specialty chip and AI arena.
Cruise Line Stock Finds Support
Outside of NVDA stock, Royal Caribbean is extended from the 5% buy zone of a cup base with a 112.95 buy point. Shares climbed from the bottom of the cup after the cruise line operator reported better-than-expected Q3 earnings and sales on Oct. 26, and raised its full-year profit guidance.
The stock has pulled back but found support at its 10-week moving average. That sets up a buy zone from about 119 to 130.
Royal Caribbean is expected to post full-2023 earnings per share of $6.61 after three years of losses. Its 2024 EPS is expected to soar to $9.16. RCL gained around 93% over the last 52 weeks and far outpaced the S&P 500.
Domino's Pizza is in the buy zone reaching to 436.60 from a flat-base buy point of 415.81. The pizza restaurant jumped 3.6% on Tuesday, after a Gordon Haskett analyst upgraded DPZ to a buy rating from hold. Domino's stock has had numerous analysts' price target hikes in the last month or so.
The company beat its third-quarter earnings estimates but missed sales expectations on Oct. 12. Quarterly EPS grew 50% as sales dropped 4% vs. a year earlier. Analysts expect 16% EPS growth for 2023 and 9% for 2024, according to MarketSmith.
NVDA stock, RCL and DPZ are top stocks to buy and watch.
Follow Kimberley Koenig for more stock market news on X/Twitter @IBD_KKoenig.
