It was a flat to moderately positive week for U.S. stock markets with the Dow Jones up 0.11%, the S&P 500 up 0.81% and the NASDAQ gaining 1.61%. The MSCI Emerging Markets Index eked out a gain of 0.12%.
Big gainers in your Bull Market Alert portfolio included The Chemours Company (CC), which jumped 8.21%, Littelfuse (LFUS), which rose 5.82%, and ABM Industries Incorporated (ABM), which added 4.63%.
A whole slew of positions hit new 52-week highs. These included ABM Industries Incorporated (ABM), Masimo Corporation (MASI), Littelfuse (LFUS), LogMeIn (LOGM) and The Chemours Company (CC).
With these broad-based gains in your portfolio, it is time to adjust your stops to lock in some profits.
Raise your stop in ABM Industries Incorporated (ABM) to $42.75 to lock in a 15% gain in the stock.
Raise your stop price in Littelfuse (LFUS) to $147.70 to lock in at least a 15% gain in the stock.
Raise your stop price in LogMeIn (LOGM) to $102.40 to lock in at least a 15% gain in the stock.
Raise your stop in Cirrus Logic, Inc. (CRUS) to $56.40 to lock in at least a 10% gain in the stock.
The U.S. small-cap index has been on fire since the election. Moreover, it remains the sole major U.S. sector that has stayed strong even as the Nasdaq and S&P 500 have slowed their ascent in recent days.
Banking, in particular, has been one of the small markets’ strongest sectors, boosted by the prospects of faster economic growth and higher interest rates ahead.
This week’s Bull Market Alert recommendation, Home BancShares, Inc. (HOMB), is just such a banking small-cap momentum play, as well as a stock that has become a big favorite among some of the leading small-cap investment strategies.
Headquartered in Conway, Arkansas, Home BancShares, Inc. is a bank holding company. It is better known to the public through its wholly-owned subsidiary, Centennial Bank. The bank provides a broad range of commercial and retail banking, plus related financial services, to businesses, individuals and governments in Arkansas, Florida, Alabama and New York City.
Home BancShares has more going for it than just the general rally in small-cap bank stocks.
Last week, a U.S. Bankruptcy Court in Tampa, Florida, designated Home BancShares, Inc. as the winning bidder to purchase The Bank of Commerce, a bank that operates in the Sarasota, Florida, area. Immediately following the acquisition, Bank of Commerce will become part of Centennial, boosting Centennial’s footprint in Florida substantially.
So buy Home BancShares, Inc. (HOMB) at market today and place your stop at $22.00.
With the stock overbought after last week’s news of the acquisition, I am holding off on making an option recommendation for now.
Portfolio Update
The TJX Companies, Inc. (TJX) gained 3.10%, rising each day after reporting positive earnings last Tuesday. Earnings per share (EPS) came in at $0.91 on revenue of $8.3 billion. Consensus analysts’ estimates called for $0.87 on revenue of $8.3 billion. Revenue pushed higher by 6.9% year-over-year, and TJX released fourth-quarter guidance looking for further earnings increases to $0.96-$0.98 per share. TJX is a BUY.
Allete, Inc. (ALE) moved 1.96% higher. ALE announced last week its acquisition of Water & Energy Systems Technology (WEST) Inc. This acquisition pushes ALE’s reach deeper into the Southern California market — a market where solutions to tightening water needs and increasing demands continue to climb. ALE is trading above the 50-day moving average (MA) and is a BUY.
ABM Industries Incorporated (ABM) jumped 4.63% last week, adding to strong gains from the week prior. Although this position had been trading sideways for several weeks and consolidating before the recent presidential election, since the Nov. 8 election this position has recorded two back-to-back weeks of substantial gains. Now up 18% in your portfolio, ABM remains a BUY.
Cirrus Logic, Inc. (CRUS) also rose sharply last week, gaining 5.82%. CRUS hit a 52-week high at just over $58 back in late September. Since this time, CRUS has pressed up against this resistance level twice, once on the day of its last earnings report. This type of upwards pressure and technical trading typically bodes well for higher prices once there is a definitive break above $58. CRUS is a BUY.
Take-Two Interactive Software (TTWO) traded sideways last week, dipping just 0.65%. TTWO released big news recently via its 2K publishing wing, announcing that its NBA® 2K17 basketball title has partnered with Fitbit. This move is the first of its kind to give in-game rewards to players based upon “healthy activity” earnings tracked via their Fitbits. Gamers around the world who achieve 10,000 steps in a day tracked with their Fitbit device will receive a temporary attribute boost to their MyPLAYER in NBA 2K17, enhancing their MyPLAYER’s performance on the court. This development was big enough to push TTWO shares up 3% the day after the announcement and skyrocket usual trading volume by an astronomical 1,033%. TTWO is a BUY.
The Chemours Company (CC) powered 8.21% higher for its first week in your portfolio. CC is a classic momentum play, and it is good to start off with strong gains as some pullbacks are inevitable. CC hit a new 52-week high as it continued its recent strong run. CC is a BUY.
