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NEW YORK ( TheStreet) -- Today we preview eight retail-oriented companies that report quarterly results on Tuesday and Wednesday. The six that are buy-rated according to ValuEngine are in the retail-wholesale sector. The two that are hold-rated are in the consumer discretionary sector.
Stocks begin the week under the fundamental backdrop of a continued ValuEngine valuation warning with 75.9% of all stocks overvalued, 43% by 20% or move. The retail-wholesale sector is 24.7% overvalued with the consumer discretionary sector 24.9% overvalued.
In the equity markets the major averages show mixed weekly chart profiles. The
Dow Industrial Average ended last week with a negative weekly chart profile, but not the other major averages. The
S&P 500 is below its five-week modified moving average, but its weekly momentum remains overbought. The Nasdaq and Russell 2000 ended the week positive but overbought. Dow transports ended the week with a neutral weekly chart profile, a close above its five-week MMA but with declining momentum. All five must have negative weekly chart profiles to signal that the early-August highs are cycle highs. Without these signals, new highs are likely in September.
Four of the eight stocks are overvalued by more than 20%. Two stocks are down 8.9% to 12.7% over the last 12 months, while five gained more than 20%. Two are trading below their 200-day simple moving averages, while five show risk of a reversion to the mean by being above their 200-day SMAs. The eighth stock tested its 200-day SMA on weakness last week.
Reading the Table
OV/UN Valued: Stocks with a red number are undervalued by this percentage. Those with a black number are overvalued by that percentage according to ValuEngine.
VE Rating: A "1-engine" rating is a strong sell, a "2-engine" rating is a sell, a "3-engine" rating is a hold, a "4-engine" rating is a buy and a "5-engine" rating is a strong buy.
Last 12-Month Return (%): Stocks with a red number declined by that percentage over the last 12 months. Stocks with a black number increased by that percentage.
Forecast 1-Year Return: Stocks with a red number are projected to decline by that percentage over the next 12 months. Stocks with a black number in the table are projected to move higher by that percentage over the next 12 months.
Value Level: Price at which to enter a GTC limit order to buy on weakness. The letters mean; W-weekly, M-monthly, Q-quarterly, S-semiannual and A-annual.
Pivot: A level between a value level and risky level that should be a magnet during the time frame noted.
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Risky Level: Price at which to enter a GTC limit order to sell on strength.