Back on June 6, three of the nine stocks had buy ratings, and six had hold ratings. Today there are two buy-rated stocks, four hold-rated names, and three sell-rated stocks. The sell-rated names are indications that these stocks have moved too high, too fast. Having a sell rating is not a recommendation to go short, but is a signal to take profits. All nine stocks are above their 200-day simple moving averages, reflecting the risk of reversion to the mean. My proprietary analytics requires nine years of price data, which explains why many of these stocks do not have risky levels.
The computer and technology sector is 22.2% overvalued. On June 6 it was 20.8% overvalued. The Internet software industry is 18.5% overvalued. One June 6, it was 3.1% overvalued. The Internet content industry is 24.2% overvalued. On June 6 it was 20.9% overvalued. And the Internet services industry is 27.8% overvalued. It was 21.6% overvalued on June 6. Stocks remain under a ValuEngine valuation warning, with 77% of all stocks overvalued.
Reading the Table
OV/UN Valued: The stocks with a red number are undervalued by this percentage. Those with a black number are overvalued by that percentage. 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 over the last 12 months. Forecast One-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: the price at which to enter a good-'til-canceled limit order to buy on weakness. 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. Risky Level: the price at which to enter a GTC Limit Order to sell on strength. OpenTable ( OPEN) ($66.50) is up just 3.2% since June 6, maintaining a hold rating. The company provides Web site software for making restaurant reservations online. OpenTable reported second-quarter earnings on Aug. 1 and beat estimates. My weekly value level is $63.82 with a semiannual risky level at $69.33.