Owens Corning Leads 5 Construction and Materials Stocks, as Vulcan Materials Lags

Armstrong World (AWI) , Lennox International (LII) , Masco (MAS) , Owens Corning (OC) and Vulcan Materials (VMC) provide products and materials to every segment of the housing market, which includes new home construction, home resales and home improvement projects. These companies can also provide their products to infrastructure programs across the country.

Infrastructure spending will include roads, tunnels and bridges, and projects for water treatment, communications, schools, hospitals, and urban renewal.

Armstrong World provides ceilings and cabinets. Lennox provides air conditioning and heating systems. Masco provides home improvement and building products. Owens Corning makes insulation, roofing and siding products. Vulcan Materials makes the ingredients for concrete and cement.

Here's the scorecard for the housing index and the five housing related stocks.

 

PHLX Housing Index

 

Courtesy of MetaStock Xenith

The housing index has a gain of 19.7% from its post-election low of 222.83 set on Nov. 9. The index set a multiyear intraday high of 267.66 on Wednesday, which is 8.9% below the all-time intraday high of 293.66 set in July 2005. The 61.8% Fibonacci Retracement of the 81.5% decline from this high to the March 2009 low of 54.31 is a key support of 202.05. The recent high was a test of my semiannual risky level of 267.16 with my annual risky level of 271.20.

Armstrong World

 

Courtesy of MetaStock Xenith

Armstrong World was a market laggard until the stock gapped higher on Feb. 27 on a positive reaction to earnings. This resulted in a post-election high of $48.00 set on March 3. The stock is in bull market territory 27.6% above its Nov. 8 low of $36.90.

The weekly chart is positive with the stock above its key weekly moving average of $43.48 and above its 200-week simple moving average of $44.32. Weekly momentum is projected to rise to 60.34 this week. Buy weakness to my quarterly value level of $40.80. My semiannual pivot is $43.58. Sell strength to my annual risky level of $63.58.

Lennox

 

Courtesy of MetaStock Xenith

Lennox has been a market leader and set an all-time intraday high of $172.07 on Wednesday. The stock is in bull market territory up 20.2% from its Nov. 10 low of $142.76. The stock set its all-time intraday high of $172.07 on Wednesday.

The weekly chart is positive but overbought with the stock above its key weekly moving average of $163.95. Weekly momentum reading is projected to rise to 80.26 this week, rising above the overbought threshold of 80.00. Buy weakness to my annual value level of $141.93. Sell strength to my semiannual risky level of $173.21. Monthly and quarterly pivots of $170.44 and $171.32, respectively, were crossed this week.

Masco

 

Courtesy of MetaStock Xenith

Masco's all-time intraday high of $37.37 was set in July 2016, but the stock has a solid gain of 14.4% since setting its post-election low of $30.04 on Nov. 9.

The weekly chart is positive but overbought with the stock its key weekly moving average of $33.62. Weekly momentum is projected to end the week at 80.42, above the overbought threshold of 80.00. Buy weakness to my annual value level of $30.40. Sell strength to my semiannual risky levels of $35.30.

Owens Corning

 

Courtesy of MetaStock Xenith

Owens Corning is the leader among these five stocks, up 20.7% year to date and in bull market territory 31.1% above its Nov. 8 low of $47.47. The stock set its all-time intraday high of $62.40 on Wednesday.

The weekly chart is positive but overbought with the stock above its key weekly moving average of $58.40. Weekly momentum is projected to rise to 90.04 this week, well above the overbought threshold of 80.00. Buy weakness to my semiannual value level of $51.28. My annual pivot is $60.30. Sell strength to my quarterly risky level of $65.27.

Vulcan Materials

 

Courtesy of MetaStock Xenith

Vulcan Materials has been the laggard thanks to a negative reaction to earnings released on Feb. 7. This stock quickly spiked to an all-time intraday high of $138.18 on Nov. 10, but then wound up trading as low as $114.10 on Feb. 24, which put the stock in correction territory 14.6% below the high.

The weekly chart is negative with the stock below its key weekly moving average of $121.63. Weekly momentum is projected to decline to 26.99 this week approaching the oversold threshold of 20.00. Buy weakness to the 200-week simple moving average of $84.41. My semiannual pivot is $122.81. Sell strength to my quarterly risky level of $143.68.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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