NEW YORK (TheStreet) -- Six of the 13 companies we profiled here last week were sent to the earnings woodshed following disappointing results or weaker than expected outlooks. Yoga pants maker Lululemon (LULU) was the biggest loser down 15.8% since Monday followed by network specialty company Ciena (CIEN) which lost 6.3% since Monday.
Since ValuEngine shows that 82.3% of all stocks are overvalued with 48.9% overvalued by 20% or more, it's not surprising that the earnings woodshed has become more crowded as companies miss earnings estimates or offer cautious forward guidance.
Among the stocks in today's post, three have buy ratings and three have hold ratings. Three stocks are undervalued by 2.9%, 9.8% and 13.5% while the other three are overvalued by 16.4%, 34.3% and 43.6%. Three have losses of 5%, 11.4% and 20.8% over the last 12 months while three have gains of 27.6%, 37.2% and 50.1% over the last 12 months. Three ended last week above their 200-day simple moving averages and three are below.
To employ a 'buy and trade' strategy use a GTC limit order to buy on weakness to a value level. Once you are long a stock, or are currently long you should consider reducing a long position using a GTC limit order to sell strength to a risky level.Ciena ($21.67 vs. $23.12 on Dec. 9 down 6.3%) missed EPS estimates by 9 cents earning 8 cents a share premarket on Dec. 12. The stock traded as high as $24.00 on Dec. 6 and stayed below its 50-day SMA now at $23.90 and traded to a post-earnings low of $20.93 on Thursday staying above its 200-day SMA at $20.45. The hold rated network specialist company is 16.4% overvalued and is up 16.4% over the last 12 months. My weekly value level is $18.31 with semiannual and annual pivots at $23.72, $22.09 and $23.33 and quarterly and monthly risky levels at $24.22 and $25.28.
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