Please ensure Javascript is enabled for purposes of website accessibility

Today's 3 Best Stocks

By Sean Williams - Apr 11, 2013 at 6:47PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

A roundup of the day's best performers within the S&P 500, and what their moves mean for investors.

One day after powering to an all-time record high on the broad-based S&P 500 (^GSPC 0.42%), investors thought the euphoria was so nice that they wanted a repeat experience. Luckily for investors, today's economic data, and a select few strong earnings reports, were more than happy to oblige.

Leading the charge was this week's initial jobless claims figure, which dropped by 10.8% to a seasonally adjusted 346,000. This was well below economists' expectations, and could signal the job market is improving at a faster rate than many are forecasting.

The other half of the coin had to do with a strong performance from the retail sector, which had been a laggard of late. We'll get to that in a moment.

For the day, the S&P 500 finished higher by 5.64 points (0.36%), to close at 1,593.37, yet another fresh all-time record high.

Today was all about retail, retail, retail, with discount brand-name retailer Ross Stores (ROST -0.09%) leading the way. Ross shares advanced a strong 5.9% after reporting a March sales increase of 6%, and a same-store sales increase of 2% over the comparable period last year. This was well above the company's own forecast for a same-store sales decline of 1%-2%. Further, sales in the first three months of the year grew 4% (1% on a same-store basis). Ross CEO Michael Balmuth noted that its EPS results are likely to come in "slightly above the high-end of our previous range of $1.00 to $1.04" for its upcoming quarter. Ross's ability to appeal to customers with fresh and in-demand brands, as well as control its inventory, is one reason I made a recent CAPScall of outperform on the company.

A day after collapsing under the weight of a CEO change, struggling department store J.C. Penney (JCPN.Q) bounced higher by 5.4%, after activist investor Bill Ackman threw his support behind new CEO Mike Ullman, calling him, "the right guy at the right time," according to a Reuters report. However, I'm not so sure Penney's will be seeing a rebound anytime soon, with Ullman admitting that he doesn't have his ducks in a row yet as to how to turnaround the company he led from 2004 to 2011. Ullman does have good rapport with J.C. Penney's vendors, but I'm not sure that's going to be enough to coax disgruntled customers back into its stores.

Finally, Victoria's Secret owner Limited Brands (BBWI -4.23%) jumped 4.3% after following Ross's lead, and reporting impressive March sales results. For the five-week period, net sales rose 6%, while comparable store sales ticked higher by 3%. For the rolling nine-week period, comparable sales are up 3%, as well. Limited has taken a lot of heat for slowing same-store sales growth in recent months after years of high single-digit growth. However, I believe this was largely unwarranted pessimism given the company's penchant for putting the right product in front of its customers, and minimizing discounts.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

S&P 500 Index - Price Return (USD) Stock Quote
S&P 500 Index - Price Return (USD)
$4,040.82 (0.42%) $16.93
Bath & Body Works, Inc. Stock Quote
Bath & Body Works, Inc.
$48.85 (-4.23%) $-2.16
J. C. Penney Company, Inc. Stock Quote
J. C. Penney Company, Inc.
Ross Stores, Inc. Stock Quote
Ross Stores, Inc.
$91.98 (-0.09%) $0.08

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/16/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.