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A Deep Post-Decline Analysis, Part 2

Retail's become a vicious conundrum of late and the list of retailers with acceptable charts is a bizarre one indeed. CVS (CVS - Get Report), which hasn't pulled back a whit since preannouncing but has based well since that event, Tiffany (TIF - Get Report), a tremendous conundrum given its previous hideous quarter, Kroger (KR - Get Report), no doubt benefitting from the perception that the Whole Foods (WFM - Get Report) dominance may be overblown (something that Safeway (SWY) confirmed in its terrific quarter earlier last week), and TJX (TJX - Get Report). The latter, a new Action Alerts PLUS stock, reports this week and if the charts is right we might have a winner.

There are some stocks that defy characterization by sector, but are too notable not point out. First, two hoteliers, Wyndham Worldwide (WYN - Get Report) and Starwood (HOT - Get Report) have pulled back to welcome levels. WYN had still one more terrific quarter and remains a huge dividend booster and a company with tons of buyback firepower, maybe the best in the book. I was glad to see Starwood bottom as it has one of the finest growth profiles that I know, yet has been hit with a couple of wrong-headed downgrades.

Time Warner (TWX - Get Report) remains totally buyable, as does Comcast (CMCSA - Get Report), both of which reported tremendous quarters. A couple of oils stand out despite the decline in price of crude. EOG (EOG - Get Report), with a retiring CEO, so it is heavily bet on to be acquired (for the record I don't think so and I like the earnings profile) and Diamond Offshore (DO - Get Report). Offshore drilling's coming back post-Macondo, but with the BP (BP - Get Report) trial beginning today I don't know if I want to get ahead of that monster.

Two others that rarely come in but can be considered retreating about as much as they have in the past before they were buyable are Gilead (GILD - Get Report) and Biomarin (BMRN - Get Report) (some great recent news there) are worth noting, as is my favorite biotech Monsanto (MON - Get Report), except this one is a biotech company for seeds. This is the best-in-show ag stock in a very bad group, including the fertilizers and a very lagging Deere (DE - Get Report).

Next up are the stocks that seem ripe for a correction, the overextended charts. There are a huge number of these that have all run too far for my tastes, perhaps because of the halo of Warren Buffett's purchase of Heinz (HNZ). Anything Buffett does is worshipped to the point where market participants will buy others in the sector hoping that lightning will strike twice.

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