5 Services Stocks Pushing Sector Growth

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model

All three major indices are trading up today with the Dow Jones Industrial Average ( ^DJI) trading up 47 points (0.3%) at 15,382 as of Tuesday, May 21, 2013, 12:50 PM ET. The NYSE advances/declines ratio sits at 1,570 issues advancing vs. 1,367 declining with 136 unchanged.

The Services sector currently sits up 0.5% versus the S&P 500, which is up 0.2%. Top gainers within the sector include Liberty Media Corporation ( LMCA), up 13.7%, AutoZone ( AZO), up 6.1%, Shaw Communications ( SJR), up 4.8%, Luxottica Group ( LUX), up 2.6% and CH Robinson Worldwide ( CHRW), up 2.4%. On the negative front, top decliners within the sector include Alaska Air Group ( ALK), down 3.72, United Continental Holdings ( UAL), down 2.32, Delta Air Lines ( DAL), down 1.66, Netflix ( NFLX), down 1.59 and Priceline.com ( PCLN), down 0.71.

TheStreet Ratings group would like to highlight 5 stocks pushing the sector higher today:

5. Starbucks Corporation ( SBUX) is one of the companies pushing the Services sector higher today. As of noon trading, Starbucks Corporation is up $0.37 (0.58) to $64.20 on light volume Thus far, 1.6 million shares of Starbucks Corporation exchanged hands as compared to its average daily volume of 4.9 million shares. The stock has ranged in price between $63.88-$64.40 after having opened the day at $64.04 as compared to the previous trading day's close of $63.83.

Starbucks Corporation operates as a roaster, marketer, and retailer of specialty coffee worldwide. As of September 30, 2012, the company operated 9,405 company-operated stores and 8,661 licensed stores. Starbucks Corporation has a market cap of $48.0 billion and is part of the leisure industry. The company has a P/E ratio of 32.6, above the S&P 500 P/E ratio of 17.7. Shares are up 19.6% year to date as of the close of trading on Monday. Currently there are 17 analysts that rate Starbucks Corporation a buy, no analysts rate it a sell, and 7 rate it a hold.

TheStreet Ratings rates Starbucks Corporation as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, notable return on equity and good cash flow from operations. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value. Get the full Starbucks Corporation Ratings Report now.

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4. As of noon trading, Target ( TGT) is up $0.42 (0.59) to $71.07 on light volume Thus far, 1.7 million shares of Target exchanged hands as compared to its average daily volume of 4.7 million shares. The stock has ranged in price between $70.44-$71.25 after having opened the day at $70.68 as compared to the previous trading day's close of $70.65.

Target Corporation operates general merchandise stores in the United States. Target has a market cap of $45.6 billion and is part of the retail industry. The company has a P/E ratio of 15.7, below the S&P 500 P/E ratio of 17.7. Shares are up 20.1% year to date as of the close of trading on Monday. Currently there are 11 analysts that rate Target a buy, no analysts rate it a sell, and 7 rate it a hold.

TheStreet Ratings rates Target as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth and growth in earnings per share. We feel these strengths outweigh the fact that the company has had sub par growth in net income. Get the full Target Ratings Report now.

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3. As of noon trading, McDonald's Corporation ( MCD) is up $0.91 (0.90) to $102.45 on average volume Thus far, 1.8 million shares of McDonald's Corporation exchanged hands as compared to its average daily volume of 4.7 million shares. The stock has ranged in price between $101.42-$102.52 after having opened the day at $101.64 as compared to the previous trading day's close of $101.54.

McDonald's Corporation franchises and operates McDonald's restaurants in the United States, Europe, the Asia/Pacific, the Middle East, Africa, Canada, and Latin America. Its restaurants offer various food items, soft drinks, coffee, and other beverages, as well as breakfast menus. McDonald's Corporation has a market cap of $101.8 billion and is part of the leisure industry. The company has a P/E ratio of 18.8, above the S&P 500 P/E ratio of 17.7. Shares are up 15.1% year to date as of the close of trading on Monday. Currently there are 14 analysts that rate McDonald's Corporation a buy, no analysts rate it a sell, and 9 rate it a hold.

TheStreet Ratings rates McDonald's Corporation as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations, growth in earnings per share and increase in net income. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook. Get the full McDonald's Corporation Ratings Report now.

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2. As of noon trading, Home Depot ( HD) is up $2.20 (2.86) to $78.96 on heavy volume Thus far, 8.9 million shares of Home Depot exchanged hands as compared to its average daily volume of 7.1 million shares. The stock has ranged in price between $78.06-$79.40 after having opened the day at $79.33 as compared to the previous trading day's close of $76.76.

The Home Depot, Inc. operates as a home improvement retailer. Home Depot has a market cap of $113.9 billion and is part of the retail industry. The company has a P/E ratio of 25.6, above the S&P 500 P/E ratio of 17.7. Shares are up 24.1% year to date as of the close of trading on Monday. Currently there are 12 analysts that rate Home Depot a buy, no analysts rate it a sell, and 10 rate it a hold.

TheStreet Ratings rates Home Depot as a buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, revenue growth, notable return on equity and good cash flow from operations. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value. Get the full Home Depot Ratings Report now.

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1. As of noon trading, Amazon.com ( AMZN) is up $1.63 (0.61) to $269.26 on light volume Thus far, 932,370 shares of Amazon.com exchanged hands as compared to its average daily volume of 3.1 million shares. The stock has ranged in price between $267.66-$270.77 after having opened the day at $268.74 as compared to the previous trading day's close of $267.63.

Amazon.com, Inc. operates as an online retailer in North America and internationally. The company operates in two segments, North America and International. Amazon.com has a market cap of $122.9 billion and is part of the retail industry. Shares are up 7.6% year to date as of the close of trading on Monday. Currently there are 21 analysts that rate Amazon.com a buy, no analysts rate it a sell, and 10 rate it a hold.

TheStreet Ratings rates Amazon.com as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins. Get the full Amazon.com Ratings Report now.

Exclusive Offer: Jim Cramer's 'go-to' small/mid-cap guru Bryan Ashenberg only buys stocks he thinks could return 50-100%. See his top picks for 14-days FREE.

If you are interested in one of these 5 stocks, ETFs may be of interest. Investors who are bullish on the services sector could consider iShares Dow Jones US Cons Services ( IYC) while those bearish on the services sector could consider ProShares Ultra Short Consumer Sers ( SCC).

A reminder about TheStreet Ratings group: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
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