Rocket Stocks for the Week
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By Jonas Elmerraji
BALTIMORE (
) -- Last week marked the busiest week of Wall Street IPOs since 2007, the largest being
A123 Systems
( AONE), a Massachusetts-based battery maker. The company raised $379 million in its offering, with shares appreciating 45% on their first trading day, a feat that IPO-tracker Renaissance Capital noted "is welcome news to many VCs and startups that have poured lots of money into the alternative energy space."
But elsewhere in the market, things weren't quite so upbeat. The
S&P 500
index shed 2.24% last week after an update from the
Fed
and a number of economic metrics sank in. Still, our Rocket Stocks managed to fare better than the market once again, with an average slip of just 0.72% for
.
That brings our outperformance to 24% over the S&P 500 during the course of the last 10 weeks.
Our biggest gainer last week was
CarMax
(KMX) - Get Report
, which announced record second-quarter earnings. The stock gained 6.61% over the last five trading sessions. Our other car play,
AutoZone
(AZO) - Get Report
, didn't fare as well in its earnings call. The company managed to report in line with analyst expectations, but investors were hoping for one better, and the stock ended the week down 5.34%.
Spice-maker
McCormick
(MKC) - Get Report
also managed to deliver solid earnings, but it saw its share price tumble 3.85%. The company's underwhelming revenue is likely to blame for that. Beating the market were
Molex
(MOLX)
and
Chicago Bridge & Iron
(CBI)
, down only 0.34% and 0.67%, respectively.
This week, however, with Monday's markets opening higher on increased corporate action activity, stocks stand a chance at recouping some of last week's losses. Here's a look at
.
When the economy's in question, it's time once again to turn to the "sin stocks," companies that deal in businesses such as tobacco, gambling and alcohol. When the economy is in question, sin stocks can be one of the bastions of profitability as stressed-out consumers seek to unwind. This week, we're turning to
Constellation Brands
(STZ) - Get Report
, the alcoholic beverage company that's set to announce earnings on Thursday. Constellation analysts are hoping to see a return to profitability this quarter, with earnings of 41 cents per share.
While not as "sinful" as Constellation, another place to look for earnings performance throughout the recession has been the tech stocks. In fact, the
Nasdaq Composite
is already crushing the S&P 500 by 18% in 2009 alone. And one of the companies best poised to profit from that outperformance is
Cisco
(CSCO) - Get Report
.
While we've looked to this networking giant in the past for an interweek Rocket Stock play, Cisco is looking attractive as ever to investors right now as the company -- and its shareholders -- benefits from increasingly good analyst sentiment, a fact that has been reinforced today with yet another analyst upgrade. An earnings call scheduled for Nov. 4 should be enough of a short-term catalyst to push the share price even higher in the coming week.
Week after week, we've managed to dig up underrated automotive plays that have beaten the market despite a drag on the industry as a whole; CarMax was the latest example of that. And in the coming week, we're hoping that
Johnson Controls
(JCI) - Get Report
meets that expectation as well.
The company is engaged in manufacturing automotive interiors, as well as efficiency solutions for buildings and batteries for a variety of applications. That product diversification should serve Johnson Controls well in the coming week. The retirement of the company's equity units should also be worth investor attention.
The transaction, which retires units issued in March, will end up netting the firm approximately $724 million. Shares of the company were trading up 1.9% early Monday.
For more stocks that made this week's cut, check out the
at Stockpickr.
-- Written by Jonas Elmerraji in Baltimore.
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At the time of publication, author had no positions in any stocks mentioned.
Jonas Elmerraji based out of Baltimore, is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.
