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Continue to Book Profits in Consumer Staples

Constellation Brands (STZ) ($32.94 vs. $31.92 on Aug. 6) - set a multiyear high at $34.20 on Sept. 7. STZ is rated a strong buy, has a so-so P/E ratio and is well above its 200-day SMA at $23.56. Employ a "buy and trade" strategy between the value level and risky level.

Whole Foods Market (WFM - Get Report) ($97.62 vs $94.60 on August 6) set a multiyear high at $99.60 on Sept. 14. WFM is rated a Buy, has an extremely elevated P/E ratio and is well above its 200-day SMA at $84.92. Employ a "buy and trade" strategy between the value level and risky level.

Wal-Mart Stores (WMT - Get Report) ($73.99 vs $74.55 on Aug. 6) set a multiyear high at $75.24 on July 30. WMT is rated a strong buy, has a so-so P/E ratio and is well above its 200-day SMA at $64.50. Consider selling strength to the multiyear high at $75.24, then employ a GTC limit order to buy weakness to my monthly value level at $72.62.

All eight of the stocks profiled today are overvalued fundamentally with overbought weekly chart profiles. All eight have traded higher by 11.3% (PG) to 72.1% (STZ) over the past 12 months, have P/E ratios between 14.4 (CCE) and 39.7 (WFM). In my judgment, when these stocks turn lower, the risk is to the 200-day simple moving averages.

At the time of publication, Suttmeier held no positions in securities mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.
Richard Suttmeier has an engineering degree from Georgia Tech and a master of science from Brooklyn Poly. He began his career in the financial services industry in 1972 trading U.S. Treasury securities in the primary dealer community. In 1981 he formed the Government Bond Department at LF Rothschild and helped establish that firm as a primary dealer in 1986. Richard began writing market research in 1984 and held positions as market strategist at firms such as Smith Barney, William R Hough, Joseph Stevens, and Rightside Advisors. He joined in 2008 producing newsletters covering the U.S. capital markets, and a universe of more than 7,000 stocks. Richard employs a "buy and trade" investment strategy and can be reached at
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XLP $49.77 0.26%
CCE $51.44 1.22%
PG $75.90 -0.72%
WMT $60.24 0.53%
WFM $29.84 0.95%


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