When putting together your watchlist, look for stocks with an 80 or higher Relative Strength Rating. STMicroelectronics just met that criteria with a new score of 80. The boost comes amid strong sales and profit growth. STMicroelectronics stock rose 1% Wednesday.
The Swiss company makes chips for a variety of industries including telecommunications systems, autos and industrial equipment.
STMicroelectronics Boasts Other Outstanding Ratings
The 80 RS Rating puts STMicroelectronics stock among the best stocks to buy and watch. Market research shows that top-performing stocks tend to have an RS Rating of at least 80 in the early stages of their moves.
IBD's unique RS Rating measures technical performance by showing how a stock's price movement over the last 52 weeks compares to that of other stocks on the major indexes.
Among its other key ratings, STMicroelectronics stock holds a powerful 97 Composite Rating, of a best-possible 99. The Composite Rating combines five separate proprietary IBD ratings, based on key fundamental and technical criteria, into one easy-to-use score. The best growth stocks have a Composite Rating of 90 or better.
One of those five is the EPS Rating. STMicro's top-notch 99 EPS Rating reflects robust recent and long-term profit growth. However, like other top stocks that got hammered during January's market consolidation, it has a weak D Accumulation/Distribution Rating. Big institutional investors will need more convincing before they dive in.
Big Profit Leaps Over The Last Year
In terms of fundamentals, the chipmaker reported 30% EPS growth to 82 cents per share in its latest quarter. The prior three periods, its EPS shot up 86%, 340% and 96%. Last quarter its revenue grew 10% to $3.56 billion, its fourth quarter of double-digit sales growth.
See How IBD Helps You Make More Money In Stocks
STMicroelectronics is building a consolidation with a 52.25 entry. See if the stock can break out in volume at least 40% higher than normal.
STMicroelectronics earns the No. 8 rank among its peers in the Electronics-Semiconductor Manufacturing industry group. ChipMOS Technologies and ON Semiconductor are also among the group's highest-rated stocks.
