Of the 1654 stocks analyzed on Monday, only 28 advanced, 1619 declined and the remaining 7 were flat on the day. Losses across the stocks averaged 3.57% on volumes 55% greater than the day previous. Losses across the capitalizations averaged 3.59%, 3.62% and 3.76% for large-caps, mid-caps and small-caps, respectively. What once was seen as overbought just two weeks ago is now oversold with 70.5% of stocks showing this indication according to stochastics.
Analysis has revealed that with a buy date of March 6 and a sell date of December 31, investors have benefited from a total return of 197.44% over the last 10 years.This scenario has shown positive results in 6 of those periods.
Conversely, the best return over the maximum number of positive periods reveals a buy date of February 28 and a sell date of June 1, producing a total return over the same 10-year range of 78.56% with positive results in 10 of those periods.
The buy and hold return for the past 10 years was 69.99%.
Comments:
Johnson & Johnson has shown tremendous outperformance compared to the market over the last week and a half.The stock recently bottomed at around $58 and found strength precisely around the period where its 50-day moving average crossed below its 200-day.Other technical indicators remain relatively favorable.
The stock currently holds an analyst "buy" rating, yet institutions have been witnessed divesting of shares on net.This high quality name now has a Price/Earnings ratio that is equivalent to that of the industry at around 12.5, still well below the 5-year average for the company at around 16.The stock pays a 3.65% yielding dividend at current levels and the volatility factor (beta) is relatively low at 0.6.Fundamentals place the value of this equity at around $65 with longer-term targets placing the stock at around $70.
The stock has beat expectations with regards to earnings in each period since 2006. Significant pressure in the market value has resulted since May due to expected exposure to the Euro zone, but much of the reaction seems overdone.Q2 earnings due out July 20 should shed further light on any impacts of the Euro problems.Analysts expect Q2 earnings per share to come in at $1.24, a 7% increase over the same period one year ago.
Seasonal tendencies are favorable between now and December for gains of 11% on average.
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Disclosure: Mr. Vialoux does not own securities mentioned in this report.
Disclaimer: Comments and opinions offered in this report at EquityClock.com are for information only. They should not be considered as advice to purchase or to sell mentioned securities.
Data offered in this report is believed to be accurate, but is not guaranteed.
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