Investors searching for hot stocks to buy or watch should check out IBD Screen Of The Day, a column that focuses on a list of top ideas in the IBD Stock Screener.
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Go to the Research tab at Investors.com and click on IBD Stock Screener. Near the top left side of the page, under IBD Stock Lists, you’ll find 12 lists. All the lists in Stock Screener offer a look at stocks with bullish characteristics.
Today we focus on Stocks That Funds Are Buying — with a technical analysis angle. Here are three hot stocks to buy or watch that big mutual funds are making initial investments in, or are adding to their stakes.
Steel stocks are still going strong, fueled by high demand and bullish growth prospects as the world tries to recover from the coronavirus pandemic. That’s helped steel producers secure the No. 4 spot of the 197 industry groups tracked by IBD.
ArcelorMittal (MT) remains in potential buy range from a 34.06 entry of a shallow consolidation cleared last week. On Thursday, the Luxembourg-based steel giant reported Q2 results that beat Wall Street targets by a wide margin. It now expects global steel consumption to rise 7.5%-8.5% this year, boosting its forecast range from 4.5%-5.5%.
IBD Stock Checkup assigns ArcelorMittal a 97 Composite Rating, which gives investors a quick way to gauge a stock’s key growth traits. The number of mutual funds holding shares of ArcelorMittal has steadily increased the past three quarters. Highly regarded funds owning shares as of Q2 include Fidelity Contrafund (FCNTX).
This REIT Leads Its Group
Among other top stocks to buy or watch, Arbor Realty Trust (ABR) is building a flat base with a 19.59 buy point, according to IBD MarketSmith chart analysis. The base is second stage, which means the stock could have plenty of runway ahead. Stocks tend to make their biggest advances out of such early stage bases.
The New York-based real estate investment trust’s 86 Composite Rating leads the 39-stock mortgage REIT group. A 78 Earnings Per Share Rating, part of the overall composite score, is also the group’s best. On Friday, Arbor met views with Q2 adjusted funds from operations of 45 cents a share. The REIT raised its quarterly dividend by a penny to 35 cents a share, its fifth consecutive quarterly increase.
Stocks To Buy Or Watch: Earnings Ahead
Revolve Group (RVLV) is setting up a chance to add or buy shares as it rebounds off the 10-week moving average line. The stock has rallied 130% this year, on top of a 334% surge from its March 2020 coronavirus crash low to its December close. The Cerritos, Calif.-based apparel retailer boasts a 98 for both its Composite Rating and EPS Rating.
But with Q2 results due Wednesday after the close, buying shares ahead of earnings could be risky. It’s tough to predict how a stock will react to an earnings miss — or perceived miss. Revolve Group has topped analyst forecasts the past four quarters and scored triple-digit growth the past three quarters.
Follow Nancy Gondo on Twitter at @IBD_NGondo
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