When a stock hits a new high after a strong run-up, look for signs of continued strength. That is because a stock with strong fundamentals that breaks out of a proper base has better chances of making more gains. That makes it a stock to watch.
Three stocks broke out to all-time highs from bases Friday.
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How To Buy Stocks: Bases And Buy Points
Blue Owl Capital (OWL) touched an all-time high Friday as it broke out of an early-stage cup base at a buy point of 20.13. Because the stock gapped above the base, a 20.63 entry is also reasonable to use.
Sales and earnings growth have been steady over the past eight quarters.
Blue Owl Capital is a specialty finance and business development firm.
The Composite Rating is its best point and stands at 93. The Relative Strength Rating is 86 while the EPS Rating lags at 63. Funds have been adding the stock to their holdings in recent weeks, giving the stock an Accumulation/Distribution Rating of C.
Collegium Pharma Among Stocks To Watch
Collegium Pharmaceutical (COLL) also made an all-time high as it broke out from a long consolidation at 40.95. This is also an early stage base that is more likely to net higher gains. Collegium’s EPS Rating is an outstanding 94, thanks to an acceleration in sales and earnings growth during the second quarter.
The company offers treatments for severe pain and some neurological disorders. Collegium has an Accumulation/Distribution Rating of B, another reason it’s among the stocks to watch.
Armstrong World Industries (AWI) hit a record high but faded in afternoon trading. The stock briefly climbed above a cup base with a buy point of 134.90.
Its Relative Strength Rating is 92 while the Composite Rating of 91 also shows the stock has outperformed several others in the Investor’s Business Daily database across several metrics.
The EPS Rating stands at 88. Armstrong Worldwide makes ceiling and wall products for offices and homes. Armstrong Worldwide is under accumulation and holds an impressive Accumulation/Distribution Rating of A-.
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