It's been a few months since I sorted through the lists of fresh 52-week highs and lows to smoke out winners and losers.
Market sentiment has been rocky in that time, but there's no shortage of winners. There is a bit of a disparity here. There were more than twice as many new highs than new lows on the New York Stock Exchange last week, but the new lows outnumbered the winners on the tech-heavy Nasdaq.
Worrywarts will argue that the stocks at the top of the range these days are headed for trouble. The future has already been baked in! The stocks just have to be expensive.
Well, I don't agree. I think more than a few of the stocks that rang up new 52-week highs last week will continue to climb in the weeks and months to come. Let me go over five names that clocked in with new highs last week that I think may just be getting started.
Last Week's High
|8x8 (Nasdaq: EGHT )||$5.25||$3.00|
|Jamba (Nasdaq: JMBA )||$2.94||$1.21|
|Sherwin-Williams (NYSE: SHW )||$136.00||$69.47|
|Cheesecake Factory (Nasdaq: CAKE )||$34.20||$23.65|
|Disney (NYSE: DIS )||$50.54||$28.19|
Source: Yahoo! Finance.
Even penthouses have roofs
Let's start at the top with 8x8.
The provider of Web-based corporate telephony solutions came through with a blowout quarter two weeks ago. Revenue climbed 36%, fueled by a 46% spike in business-class orders. 8x8's adjusted profit of $0.05 a share was nearly twice as much as the market was expecting.
As the economy claws its way back, it's easy to see companies drawn to 8x8's cost-efficient communication solutions.
Jamba has been moving as fast as one of its fruit-crushing blenders. Shares of the Jamba Juice parent have more than doubled in 2012, and the 769-unit smoothie chain is more popular than ever. Comps have clocked in higher for five consecutive quarters, snuffing out any fears that fast food chains and coffee shops adding smoothies to their premium drink menus would eat into Jamba's business.
That clearly hasn't happened. If anything, the presence of smoothies being blended up by both baristas and burger flippers has educated the market on the beneficial attributes of chilly, all-natural fruit drinks.
There were two strong quarterly reports out of the home-improvement sector, and neither came from paint giant Sherwin-Williams. The country's leading hardwood flooring specialty retailer and the top dog in composite decking posted better than expected financial results.
What does this have to do with a can of paint? Well, it has everything to do with a can of paint. Now that home prices are starting to stabilize, homeowners can finally feel comfortable in knowing that their mortgages aren't going go underwater. Now is the perfect time to take on those paint jobs that have been put off for far too long, and Sherwin-Williams will be a big winner. Sure, the stock appears a bit overvalued at 21 times this year's earnings and nearly 18 times next year's profit target, but reality will probably be kinder than Wall Street estimates, which have proven to be conservative in the past.
Yesterday was National Cheesecake Day, and Cheesecake Factory celebrated by offering half-priced slices for any dine-in customers. Anyone that has stopped by a local outlet of the casual dining cult favorite knows that the company didn't need to drum up a promotion to fill up tables -- even on a Monday.
Cheesecake Factory has been posting strong results and will continue to be a beneficiary of consumers going out to eat more.
The market's getting excited about theme parks again. Shares of Disney -- as well as the country's two largest publicly traded regional amusement park operators -- posted fresh highs last week. Between strength at its theme parks, cruise lines, and its ESPN- and ABC-anchored broadcasting properties, the House of Mouse is sitting pretty ahead of a gradual global recovery.
Keep reaching for the stars
All five of these companies have come through with monster runs to reach these lofty heights. Most of them have strong connections with consumers, and that's the stuff that helped steer Peter Lynch to market-thumping results.
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