This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

10 Profitable and Oversold Stocks Ready To Move Higher

NEW YORK ( TheStreet) -- As difficult as it may be at times, acquiring stocks when they are despised by others demonstrates an ability to separate sensation from logic. Companies become oversold when passion takes over in the market and plunges the prices lower.

The desire to escape the suffering of additional losses results in many selling at the particular instant they should buy.

Of course, sporadically stocks become oversold as a result of proper money-management stop-losses activated. Having a stop-loss is imperative to investing endurance and your exit strategy must be put in place afore contemplating an entry.

Typically, stocks do not become oversold on a daily or weekly timeframe because of stop-losses triggered. It's more often the outcome of emotion dictating selling, and emotional dumping sets up our opportunity.

Here is a list of 10 candidate companies that are oversold on my charts. My ideal technique to exploit the weakness is to sell put options or write covered calls (pretty much the same thing). The typical trade lasts three to four weeks.

TRW Automotive Holdings(TRW)

Background:

TRW trades an average of 1.2 million shares per day with a market cap of $4.1 billion.

Six out of 7 analysts now rate TRW a strong buy, up from five analysts a month ago. Shares have fallen 34.4% in the last year, and the average analyst target price for TRW is $61.88. TRW Free Cash Flow Chart TRW Free Cash Flow data by YCharts

The last date TRW released earnings was May 1, and the closing price before earnings was $45.99. Based on a recent price of $33.60, shares are down 25.3%.

TRW is oversold on the daily chart while still in an upward weekly chart trend.

The company has rising revenue year-over-year of $16.24 billion in the last fiscal year compared to $14.38 billion in the previous year. The company's earnings before interest and taxes are rising with an EBIT year-over-year of $1.26 billion for the last fiscal year from $1.18 billion for the previous annual report.

I like the September$30 put during the next few trading days for 50 cents or greater. My profit target is 40 cents or close out on option expiration date.
1 of 5

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
AAPL $113.29 0.00%
FB $91.01 0.00%
GOOG $630.38 0.00%
TSLA $248.48 0.00%
YHOO $33.14 0.00%

Markets

Chart of I:DJI
DOW 16,643.01 -11.76 -0.07%
S&P 500 1,988.87 +1.21 0.06%
NASDAQ 4,828.3250 +15.6170 0.32%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs