In the flurry of newly public companies posting big price gains, it’s easy to overlook long-established companies like Dell Technologies NYSE: DELL, Goodyear NASDAQ: GT, and Charles Schwab NYSE: SCHW that are flashing technical and fundamental strength.
It’s true that companies that went public within the past 15 years are often among the market’s biggest gainers. But that doesn’t mean they’re necessarily the only games in town.
In a sense, Dell straddles the line between an older name and a relatively recent IPO. The computer maker originally went public way back in 1988. It went private in 2013, and in 2016 merged with EMC, and in 2018 went public with its own NYSE listing.
The stock advanced 58.68% in the past year. The stock cleared a flat base on December 3, surpassing its October 22 high of $58.32. Shares closed Friday at $57.60, down $0.05 in lighter-than-normal volume.
Dell notched gains in 10 of the past 12 months.
Dell as a company has moved far beyond its early days of shipping computers to customers. Like other techs, it’s now focused on the fast-moving pace of change for enterprise customers. Those changes include the shift of ditigal assets to the cloud, and the move to remote work.
Its product line now focuses on software and services solutions aimed at business users.
The stock split approximately 2-for-1 on November 3, two days after the company spun off VMWare, which provides networking and security software, as well as storage and data-center products.
For Dell, the spinoff means a reduced debt load. That in turn may lead to other benefits for shareholders, such as dividend payments.
Looking ahead, analysts expect Dell to earn $6.88 per share in 2022, which would be a 21% year-over-year decline. The number of mutual funds owning shares grew in the most recent quarter, to 1,341.
Tire maker Goodyear rallied to a high of $24.89 on November 5, following its better-than-expected third-quarter earnings report. With that rally, the stock cleared a cup-shaped base.
It then pulled back and found support at its 50-day average. That kind of price action is not unusual; after a stock runs to a new high, investors who bought at a lower price often take the opportunity to pocket some profit. The moving-average support indicates that some institutions were only paring back positions slightly, and other institutions were scooping up shares at a lower valuation.
The stock is currently in a buy zone.
After a loss in 2020, the stock returned to profitability in the past four quarters, and Wall Street expects earnings of $1.83 per share for the full year. That’s seen rising 43% in 2022, to $2.61 per share.
Strong quarterly sales, which rose 42% year over year, helped boost the stock price. In its earnings call, CEO Richard Kramer noted that the company is “experiencing significantly higher inflationary cost pressures, while manufacturing locally in the regions where we're selling tires partially insulates us from cost increases related to global supply chain challenges.”
To counter these impacts as well as higher raw material costs, the company has increased its prices, as well as focusing on global market-share growth.
Brokerage Charles Schwab was a growth leader in the years leading up to the dot-com boom, as it profited from active trading in tech stocks. Since then, the stock has been through several of its own leader-and-laggard cycles.
Recently, though, it’s been on a tear. Schwab is up 62.73% in the past year.
It’s currently forming a flat base with a 10% peak-to-trough correction below an October 26 high of $84.49.
Shares closed Friday at $80.81, up $0.15, or 0.19%.
Earnings and revenue are behind the strong price action. Revenue grew at double-digit rates in the past four quarters, accelerating in the past three. Earnings growth, too, has been accelerating. According to MarketBeat earnings data, Schwab beat analysts’ earnings views in eight of the past 10 quarters.
Schwab isn’t quite buyable yet, as it’s still forming the current base. A medium-term trend line indicates a possible buy point at around $84.
Before you consider Dell Technologies, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Dell Technologies wasn't on the list.
While Dell Technologies currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
Options trading isn’t just for the Wall Street elite; it’s an accessible strategy for anyone armed with the proper knowledge. Think of options as a strategic toolkit, with each tool designed for a specific financial task. Get this report to learn how options trading can help you use the market’s volatility to your advantage.
Get This Free Report
