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JimVanMeerten (65.25)

Verizon on the horizon

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December 07, 2009 – Comments (2) | RELATED TICKERS: VZ

Over the weekend I determined that I'd be a net buyer into the market this week. I had some buying power in my Wall Street Survivor portfolio so I used BarChart to find what stocks were hitting new highs most frequently. After getting the top ten and doing some additional screening I decided to add Verizon (VZ) to my portfolio. Verizon is one of the largest providers of both wired and wireless communications.

During my BarChart screenings I determined VZ had hit new highs in 12 of the last 20 trading sessions and was 5 for 5 the past week. There has been a 16.17% price appreciation in the last 65 days. BarChart's technical indicators have buy signals on 11 of the 13 indicators and the sell is a long term indicator.

There are 32 Wall Street analysts following the stock and although they estimate only a .09% increase in sales and a 1.6% increase in earnings 16 still recommend you buy the stock. The only sell recommendation was made back in January and seems too old for me to consider.

I'm starting to like the Wall Street Survivor Mark's checklist which has a Survivor Sentiment rating of 5/5, fundamental rating of 4/5 and a technical rating of 5/5. Motley Fool CAPS members think the stock will out perform the market with a vote of 3386 to 198 with the All Star members in agreement with a vote of 847/38. Motley Fool follows some Wall Street columnists and they like the stock 32 to 1.

I'm the first to admit that I have no crystal ball and I don't have an original thought in my head. I've just developed a method to find stocks with a positive price momentum and a discipline to manage the portfolio I own. To be added to my portfolio a stock must:
1 - Hit new highs more than 50% of the time

2 - If followed by Wall Street Brokerage firms not have a majority of sell recommendations out there - trash taking by brokers usually means net sells

3 - Have some confirmation of my research by some of the other technical indicator sites I follow

Recommendation: Verizon Communications (VZ) meets my criteria and is being added to my Wall Street survivor portfolio around 33.15 with a protective stop loss of no lower than 30.

Disclosure: I own no positions in the stock at the time of publication.

Jim Van Meerten is an investor who writes on financial matters here and on Financial Tides. Please leave a comment below or email FinancialTides@gmail.com

 

2 Comments – Post Your Own

#1) On December 07, 2009 at 11:47 AM, SolarisKing (< 20) wrote:

Thanks Jim.

 

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#2) On December 07, 2009 at 12:19 PM, leohaas (31.55) wrote:

Isn't this approach a form of performance chasing? Sure, a stock meeting your requirements has done well over the past weeks. Can you explain why the chances that it will do well over the next weeks/months/years are increased because of your approach?

Particularly about VZ: this is the best US telecom provider to have in your portfolio. They are a strong player in both the wireless and the wired world. Droid will be the driver for continued wireless growth, and FiOS for wired growth. If they could just buy out Vodafone...

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