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

Book Profits on Sell Rated Industrial Products Stocks

NEW YORK (TheStreet) -- The industrial products sector is 25% overvalued in a market where 83.2% of all stocks are overvalued with 51.4% overvalued by 20% or more. Within this sector there are 342 stocks and 40.9% are rated sell or strong sell according to www.ValuEngine.com. This gives the sector an underweight rating.

In this market environment I have identified seven industrial products companies that are rated sell and overvalued by 30.6% to 65.1% including Manitowoc (MTW - Get Report) and H&E Equipment (HEES - Get Report) which are the most overvalued.

The industrial products sector gained 38.4% over the last 12 months and five out of seven in today's post gained 49.5% to 120.8% with Taser (TASR) the best performer.

All seven of these stocks are trading above their 200-day simple moving averages which reflect the risk of reversion to the mean in 2014.

If you own any of the stocks in today's post consider taking profits now! If you want to keep an investment exposure to this sector re-invest a portion of the proceeds into the Industrial Sector SPDR Fund (XLI) ($50.24) in a strategy to underweight this sector. My semiannual value level is $43.08 with semiannual and monthly pivots at $49.14 and $49.96 and quarterly and weekly risky levels at $50.44 and $51.80. The industrial ETF set an all-time intra-day high at $50.77 on Nov. 29 and has been above its 200-day SMA all year which is now $44.96. Beware that the weekly chart of the industrial sector fund is extremely overbought in a parabolic formation I consider a bubble formation with the five-week modified moving average at $49.51.

1 of 3

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
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
HEES $24.49 0.00%
MTW $19.39 0.00%
AAPL $130.28 0.00%
FB $81.53 0.00%
GOOG $565.06 0.00%

Markets

DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs