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Boeing: The Ultimate Comeback Stock
Two of the top stocks to watch today (Tuesday, May 16) are both tanking and have now fallen at least 13% in the last month. The third stock we're watching is higher this morning after bullish ownership news.
Both stocks that are tanking this morning are retail stocks. We've been warning readers about the death of retail stocks for months. Today's performance is proving us right. Vendor concerns about payment are sinking the first stock. The second stock is tanking due to disappointing earnings.
Top Stocks to Watch Today: Sears Holdings Corp. (Nasdaq: SHLD)
Sears is continuing its downward spiral that started May 10. Since then, the stock is down 24%, while the Dow has remained mostly flat. Sears stock is down another 2.5% in morning trading today.
The traditional retailer has been struggling for years, but in its annual report, the company expressed concerns about its ability to stay in business.
In the report, the company also cited vendor financing as a possible concern; however, the firm did not provide specifics (you can see the full story here). It is one of the reasons investors are concerned about the company's ability to stay in business.
Yesterday, CEO Eddie Lampert publicly went after Sears' vendors in a blog post. One World is a vendor he singled out, accusing the company of trying to take advantage of the bad press surrounding Sears' financials.
In the blog post, Lampert does admit that the stories have some merit to them but are obviously written to incite fear. However, the fact that there is some merit to the stories has been enough to spook investors.
If you followed Money Morning Chief Investment Strategist Keith Fitz-Gerald, you would have been perfectly positioned to cash in on the investor panic over the last week.
Fitz-Gerald has urged readers to short Sears since January 2012. Since that time, the stock has lost over 70% of its value, while the Dow has gained 70%.
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Why SHLD is a must-watch today: Sears has been in decline for at least five years, falling 85% in that time. It is unlikely the company will be able to turn things around any time soon. In fact, we at Money Morning expect Sears to declare bankruptcy sometime in the next year.
Top Stocks to Watch Today: Dicks Sporting Goods Inc. (NYSE: DKS)
Dicks Sporting Goods stock is down 13% in early morning trading after same-store sales missed expectations.
The sporting goods retailer saw same-store sales grow 2.4%, below the expected 3%. However, adjusted EPS met analysts' expectations at $0.54.
The company expects full-year adjusted EPS to be between $3.65 and $3.75. Analysts expect adjusted EPS to be $3.72.
Over the past five years, Dicks has been struggling like most traditional retailers. The stock is down 13.77% over the past five years, while the Dow is up 63% over the same time period.
While some investors point to DKS' 4% gain in the past year as a turnaround for the company, the stock has performed terribly so far in 2017. Year to date, the stock is down 21%.
Why DKS is a must-watch today: DKS stock is not in turnaround mode, and today's stock price drop is further evidence of that. Ultimately, it is still a struggling retailor that we don't recommend. Slow sales growth is evidence of that struggle.
Top Stocks to Watch Today: Boeing Co. (NYSE: BA)
Boeing stock is rising this morning after it was announced that Meridian Wealth Management bought a $5 million stake, equaling 0.844% ownership of the company, back on March 31. This brings total institutional ownership of the stock up to 77%.
Boeing stock is up 2.5% since Meridian purchased its stake. Meanwhile, the Dow is up only 1.2%.
The company's resilience and ability to outperform the market is why Money Morning Executive Editor Bill Patalon loves Boeing stock. Since he recommended readers buy Boeing in September 2011, the stock has gained 190%, while the Dow has only gained 86%.
Between 2008 and 2009, Boeing stock lost nearly 40%, while the Dow only lost 22%. However, since the end of 2009 until today, Boeing has gained 241%, while the Dow has only gained 100%. Boeing has far outpaced the markets as a whole during the recovery from the Great Recession.
Why BA is a must-watch today: Boeing has been on an upward climb for over a year, gaining 38% in that time. Today's ownership announcement just confirms what we already knew. The company remains a great buy.
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