This is a busy week for the Alpha Algorithm trading service.
Let’s start with this week’s new recommendation.
The Priceline Group Inc. (PCLN) provides online travel and restaurant reservation and related services. The company operates Booking.com, which provides online accommodation reservation services, and priceline.com, which offers hotel, rental car and airline ticket reservation services, as well as vacation packages and cruises through its Name Your Own Price and Express Deals travel services.
The Priceline Group Inc. (PCLN) versus the S&P 500 Year to Date
Eight Top Investment Strategies Betting on The Priceline Group (PCLN)
- High Quality Stocks
This strategy seeks U.S. stock that exhibit positive fundamentals, including high return on equity, stable year-over-year earnings growth and low financial leverage.
- Momentum Model
The stock is among the top approximately 100 U.S.-listed companies to demonstrate powerful relative strength characteristics relative to the 3,000 largest U.S.-listed companies.
- Large-Cap Momentum
The stock is part of a major hedge fund’s systematic strategy that invests in large- and mid-cap U.S. companies with positive momentum and that rank in the top third of total return over the prior 12 months, excluding the last month.
- IBD Top 50
It is a Top 50 stock based on Investor’s Business Daily‘s proprietary trading formula to identify 50 stocks that meet one of seven different catalysts. The “CAN SLIM” strategy identifies companies with either fundamental (improving earnings, new product) or technical (upward stock move on strong volume) catalysts.
- Large Cap Growth
The stock is among the top 50 large-capitalization U.S. growth stocks generated through a rigorous 10-factor fundamental screening process.
- Pure Growth
The company is part of a strategy that selects companies from the S&P 500 Index, based on three growth factors: current internal growth rate, historical earnings per share (EPS) growth and historical sales/share growth.
- Large-Cap Alpha Growth
Priceline has been chosen as part of an alpha-seeking index that selects and weights growth stocks from the S&P 500 Growth Index. The proprietary methodology uses price appreciation — among more traditional factors — and weights the constituents based on their respective growth scores.
- Knowledge Leaders
The stock benefits from the “knowledge effect” — the tendency of innovative companies to outperform, and is selected by adjusting historical financial statements to obtain its level of “knowledge capital.”
Buy Priceline (PCLN) at market today and set your stop at $1,640. I am holding off on making an options recommendation on this stock for now.
Sell your remaining Amazon.com (AMZN) April $845 calls (AMZN170421C00845000), which expire on April 21. The purchase price was $25.14.
Option recommendations have been sparse over the past few months in the Alpha Algorithm. That’s because so few of your positions offered adequate entry points. With U.S. stock market trading flat over the past month or so, several of your positions are oversold, and now offer solid entry points.
So, if you want to take on some additional risk, you may want to purchase the following options.
Buy the Johnson & Johnson (JNJ) June $125 calls (JNJ170616C00125000), which last traded at $2.50 and expire on June 16, 2017.
Buy the UnitedHealth Group (UNH) June $165 calls (UNH170616C00165000), which last traded at $5.45 and expire on June 16, 2017.
Nicholas A. Vardy