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Garmin and Crocs: Where the Traders Are

  • November 5, 2007
  • David Penn

Among those stocks that traders are most interested in today, at least two– Garmin
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With a PowerRatings (for Traders) rating of 8 for GRMN and a PowerRatings (for Traders) rating 7 for CROX, neither stock can be said to represent the best of the best of trading opportunities available right now.  That said, those determined to ply their trade in either of these two popular stocks can feel confident by virtue of their “in the green” PowerRatings that these stocks remain likely to provide traders with upside in the near-term.

What kind of upside?  Although there is no guarantee of specific results in specific instances, stocks with PowerRatings (for Traders) ratings of 8 have historically outperformed the average stock by a better than 5.8 to 1 margin over a five-day period.  Even a “7” stock like CROX has historically outperformed the average stock by a better than 2.9 to 1 margin over a five-day period.

GRMN is especially interesting because not only does the stock have a nicely “green” PowerRatings (for Traders), but also the stock has developed the kind of pullback that often attracts traders and investors looking to buy stocks “on sale.”  For example, GRMN shows up as one of the higher rated “bullish” stocks in the TradingMarkets Stock Indicators screen for stocks that are trading down 10% or more, while still trading above their 200-day moving average.  GRMN, I should also note, finds itself on our PowerRatings (for Traders) Preferred List of higher rated momentum stocks that tend to be held by large institutions, mutual funds and hedge funds.

CROX, like GRMN, posted outstanding third quarter financial results only to find itself under selling pressure in the days immediately afterward.  And, also like GRMN, CROX’s correction appears to be creating an opportunity for traders and investors to pick up significantly discounted shares insofar as CROX also appears in the TradingMarkets Stock Indicators screen for stocks down 10% or more, but above their 200-day moving average.

Cumulus Media (CMLS): True Leader of the Pack

As good as GRMN and CROX might be, there may be even better near-term opportunities that traders should be aware of.  Among the nine stocks currently in our “9’s and 10’s” list of the highest rated PowerRatings stocks as of today’s open {November 5], six are holding their “9” rating in the first few hours of trading, one has slipped a notch to “8” and another, Cumulus Media
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It is hard to beat stocks with PowerRatings (for Traders) ratings of 10.  These stocks have historically outperformed the average stock by a very impressive margin of better than 14.7 to 1 over a five-day period.

The bullishness of CMLS has been picked up by one of TradingMarkets Stock Indicators, as well.  In fact, CMLS is among the top two stocks at the present time with a two-period RSI (Relative Strength Index) below 2.0, that is also trading above its 200-day moving average.  TradingMarkets research has shown that stocks with a two-period RSI below 2.0 that are also trading above their 200-day moving averages have shown positive gains on average in the near-term.

Third Wave Technologies (TWTI) and Ninetowns Internet Technology (NINE): Friday’s Winners Still Winning

How have recent “9” and “10” rated PowerRatings (for Traders) stocks fared lately?  Which ones should traders be adding to their porfolios and which ones should traders consider replacing?

Of the seven stocks listed in our “Past Two Days’ 9’s and 10’s”, two continue to be just as impressive this morning as it was days ago when they appeared as a “9’s” in our PowerRatings (for Traders) listing.  These stocks, Third Wave Technologies
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PowerRating), remain very attractive, posting consecutive daily PowerRatings (for Traders) of 9, 10, 9 and 9, 9, 9 respectively–including “9” ratings in the first few hours of trading this morning.

NINE, by the way, also made our TradingMarkets Stock Indicators bullish list as of today in the wake of falling 10% or more.  Sell-offs such as these among stocks that are still trading above their 200-day moving averages often create excellent opportunities for bargain hunters looking to pick up shares of good stocks–again, NINE features a “9” PowerRating (for Traders)–at significantly discounted prices.

Bullish PowerRatings (for Traders) Stocks Recap:

GRMN: PR 8. Preferred List. Down 10% or More.

CROX:  PR 7.  Down 10% or More.

CMLS: PR 9. 2-period RSI Below 2.0.

TWTI: PR 9. Sustained high PR in recent days.

NINE: PR 9. Sustained high PR in recent days. Down 10% or More.

David Penn is Senior Editor of TradingMarkets.com.