Proprietary Data Insights
Stocks With the Biggest Surges in Interest This Week
Heading into Thanksgiving, The Juice will take the long weekend off and be back to our regularly scheduled programming on Monday.
Maybe we’ll see the beginning of a Santa Claus rally?
With the national day of gratitude upon us, The Juice and our sister newsletter, The Spill, are thankful for our older sibling – the Trackstar database. It’s one of the big perks of subscribing to our daily emails.
Trackstar is our proprietary sentiment indicator. Across our universe of financial media partners, Trackstar tallies the tickers – stocks, ETFs, mutual funds, crypto – financial professionals and everyday investors are searching for.
We use Trackstar to craft stories, develop investment ideas, and harvest these ideas for you.
In today’s Juice, we use the five stocks with the biggest surges in investor interest this week to illustrate the types of ideas Trackstar puts on our radar.
If you’re a long-term investor, there’s one in particular you might want to add to your holiday shopping list.
5 Stocks With Huge Surges in Interest This Week
Source: Google Finance
The stock with the fifth-biggest surge in investor interest – Ross Stores (ROST) – was the best performer of the top five over the last week. It’s also the name we feel most comfortable putting our money in.
We’ll tell you why – and explain the surge – in a second, but first a quick look at a couple of the other names.
Proceed With Caution on Penny Stocks
Last month, The Juice devoted an entire installment to penny stocks. While we urge caution on sub-$5 and sub-$1 stocks, they’re not off limits.
In fact, a surging Trackstar stock – one that actually ranked in the top five searches among all stocks for a while, alongside Tesla (TSLA) and Apple (AAPL) – helped illustrate our points on penny stocks. You could have made money trading American Virtual Cloud Technologies (AVCT) at the time. But it made absolutely no sense as a long-term investment.
Like many penny stocks that generate interest, AVCT’s move came on buyout speculation that began in a press release from the company itself. This was one tactic we warned about:
Anybody can publish a press release. If you’re researching a company and all you can find are press releases with imprecise claims and half-hearted, uncertain outlooks on the future, stay away.
Some companies issue press releases to drum up interest. While they may have good intent, if it’s absent hard news and solid numbers, that’s a red flag.
After the pop in AVCT came the inevitable drop. Since we last mentioned the stock in October, it’s down 65%.
Doesn’t mean you shouldn’t trade it if you have the skills. Doesn’t mean you should never own a penny stock long term. Just means be careful.
That said, we’re not buying the surge in #2 TPT Global Tech (TPTW). As a rule of thumb, when a stock price begins with more than one zero, proceed with even more caution.
TPT Global Tech provides marketing services for streaming media and other content companies. Outside of a press release here or there touting the work it’s done on “projects” with large, well-known companies and abysmal financials (net income down 109% year over year and just $107,000 in cash on hand), there’s not much out there on TPTW.
With so many other names that breed confidence, why take a chance on a relative unknown? Sometimes it makes sense. This time, it doesn’t.
When a stock catches our eye in Trackstar – penny or otherwise – we’ll do what we did today. Give it a thumbs-down, as with TPTW… a thumbs-up with qualifiers, like we did with AVCT… or a thumbs-up with a green light, which we’re giving #5 Ross Stores, which had a 773% surge in interest over the last week.
Why Did Ross Rise?
With roughly 9,200 more searches this week than last in Trackstar and a nearly 20% pop in the stock over the last week, Ross rose because it beat earnings estimates on the top and bottom lines.
Credit Suisse named Ross a top pick among discount retailers, raising its price target to $123, which is 7% higher than where the stock trades today. Morgan Stanley upped its price target to $127, indicating 10.4% worth of runway left.
The Juice agrees there’s plenty of room to climb. We love Ross as a near-term momentum play and a long-term investment.
We expect it to meet or beat Q4 earnings expectations as inflation brings more shoppers, particularly low- to moderate-income consumers, into its stores. Ross raised guidance on the positive Q3, noting it has a low bar to beat given its relatively weak holiday quarter in 2021.
If you’re a long-term investor, you can hold Ross even longer. We like it for many of the same reasons we like Dollar General (DG) and Dollar Tree (DLTR). With the problems of record-high credit card debt and near record-low personal savings not fixing themselves overnight, The Juice thinks discount retailers should perform well for the foreseeable future. Long term, there’s always a market for paycheck-to-paycheck consumers struggling to make ends meet.
Additionally, Ross pays a $1.24 annual dividend, currently yielding just over 1%. With a low 25% payout ratio, the company has the firepower to raise this payment. Even if it doesn’t, it’s buying back stock. The company is in the middle of a two-year, $1.9 billion repurchase program.
The Bottom Line: If we see something enticing in Trackstar, we’ll say something. Going forward, know that we’ll put only the names we like in front of you. While we’ll reference reasons for caution from time to time, the main goal is to generate solid trade and investment ideas.
Trackstar helped put Ross on our radar. After focusing on DG and DLTR, this surge made us realize we should be bullish on Ross for the same reasons we are for other outperforming discount retailers.
Source: Google Finance
These stocks still have room to run.
News & Insights
Want to get content like this directly to your inbox?