Defying the Market: 3 Mega-Cap Stocks Soaring to New Highs

Key Points

• AstraZeneca is reaching all-time highs, driven by strong oncology developments and expansion into the weight loss market. 
• T-Mobile US has surged over 40% in the past year, leveraging its leadership in 5G and consistent earnings growth to solidify its position as a market leader.
• Intuitive Surgical continues its robust growth with a 39% YTD surge, though its high P/E ratio presents a challenge, making it appealing primarily to aggressive growth investors.

In a market characterized by uncertainty and volatility, it's increasingly rare to find stocks that are weathering the storm and thriving. Yet, a select few from various sectors are doing just that—hitting all-time highs even as the broader market indices attempt to regain their footing. 

These three stocks, outlined below, showcase remarkable relative strength, which could signal potential buying opportunities for discerning investors. But what is driving this outperformance, and can it be sustained? Let's look at these three stocks from different sectors that have defied the odds, reaching new highs despite the turbulent market environment.

Why AstraZeneca's Market Strength Makes It a Top Biopharma Stock

AstraZeneca NASDAQ: AZN, a biopharmaceutical giant with a market capitalization of $259 billion, is hitting new all-time highs despite recent market turbulence. As one of the largest biopharmaceutical companies globally, AstraZeneca is a top-rated stock, boasting a Moderate Buy rating and a consensus price target, forecasting a 7.7% upside. The stock also offers a dividend yield of 1.18%.

The healthcare sector, represented by the XLV ETF, is up 10.88% year-to-date and is just 0.36% away from its 52-week high. However, AstraZeneca has outperformed significantly, climbing nearly 24% and reaching new highs. This impressive relative strength is primarily attributed to positive developments in its oncology franchise, with successful clinical trials like LAURA, ADRIATIC, and DESTINY-Breast06 driving momentum. Moreover, AstraZeneca has provided long-term revenue guidance for the first time, projecting $80 billion in revenue by 2030—a 75% increase from its 2023 revenue of $45.8 billion, suggesting an annual growth rate of 8% over seven years, surpassing the growth targets of its competitors.

Adding to its growth prospects, AstraZeneca is expanding its footprint in the weight loss market. The company announced in May that it had committed $80 million in non-dilutive funding to Swiss biotech SixPeak Bio, which is developing a bispecific antibody therapy for weight loss. This funding will be disbursed over the next two years, with AstraZeneca retaining exclusive rights to acquire SixPeak Bio during this period. While the exact acquisition price remains undisclosed, AstraZeneca can execute the buyout at the time of the investigational new drug (IND) application submission for the lead candidate.

Analysts Favor T-Mobile: A Top Pick in Telecommunications

T-Mobile US NASDAQ: TMUS, a leading telecommunications company in the United States, has consistently proven its strength in the market. With a $228 billion market capitalization, T-Mobile is one of the largest wireless carriers in the country, serving millions of customers nationwide. The stock is well-regarded by analysts, carrying a Buy rating and a consensus price target forecasting a nearly 2% upside. Additionally, TMUS offers a dividend yield of 1.33%.

The stock's performance over the past year has been remarkable, rising over 40% and currently up nearly 22%, trading at all-time highs. With a forward P/E of 17.21 and strong earnings growth, T-Mobile's valuation and growth prospects appear robust. In its most recent quarterly earnings report, released on July 31st, 2024, T-Mobile posted $2.49 earnings per share (EPS), surpassing analysts' consensus estimates of $2.27 by $0.22. The company reported revenue of $19.77 billion for the quarter, slightly ahead of the $19.61 billion expected by analysts, representing a 3.0% increase year-over-year.

The company's EPS growth this year is an impressive 34.47%, with EPS growth over the next five years expected to reach 26.15%. Following its merger with Sprint, T-Mobile has solidified its position as a dominant player in transitioning to 5G service. With a bold growth strategy and a consistent track record of success, T-Mobile is well-positioned to maintain its leadership in the US mobile market. This strong performance and forward-looking growth potential have contributed to T-Mobile's relative strength, making it a stock to watch amid market uncertainty.

Intuitive Surgical: Innovation-Driven Growth in Medical Technology

Intuitive Surgical NASDAQ: ISRG, a leader in medical technology, specializes in robotic-assisted surgical systems, notably the da Vinci Surgical System. With a market cap of $166.44 billion, ISRG stands out for its innovation and dominance in the industry.

ISRG's P/E ratio of 84.7 reflects its strong growth, appealing more to aggressive growth investors. In its latest earnings report on July 18th, 2024, the company posted $1.78 earnings per share (EPS), beating estimates by $0.24, with revenue of $2.01 billion, up 14.5% year-over-year. Despite its impressive 39% year-to-date surge, analysts see a nearly 6% downside due to its high valuation, though projected earnings growth of 17.05% keeps it attractive for those focused on long-term growth.