Investor's Business Daily, May 24th, 2007
The biggest winners in stock market history showed tremendous price and volume strength as they rocketed to huge gains. But the best stocks also feature top-notch fundamental growth, fueled by a leading position in the marketplace.
IBD's New America page profiles companies assuming that leadership role, and the products and services that pave the way.
The New America links to the "N" in IBD's CAN SLIM investing system: New products, new management and new highs. The idea is that new technologies and rising sectors of the economy continually produce winning stocks.
New America articles set their sights on industry groups and sectors that attract the attention of institutional investors.
These features then zero in on the best-managed, most innovative companies within those rising groups. The articles investigate strategies, products and details of how companies pursue their markets. The articles sort through earnings growth, sales growth, debt, margins and other questions affecting the stock's financial strength.
One example: The Oil & Gas-Machinery/Equipment group's run-up that began in 2004. In August 2004, the group was recovering after a three-year, 36% correction.
In the month before the group broke above its 2001 high mark, its components became a New America focal point. In September 2004 the group broke above its old high and launched into a steep ascent.
In August 2004, three of the group's highest-rated stocks -- Weatherford International WFT, National Oilwell Varco NOV and Universal Compressor UCO -- appeared as New America subjects.
Weatherford International broke out on Sept. 17, 2004, launching a 141% run-up. National Oilwell Varco consolidated for a few months after its New America appearance, then broke out in January. It rose 126% in less than 12 months.
Universal Compressor rose sharply, pulling back periodically to digest its gains. It has since climbed 75%.
As is usually the case, the original group of breakouts eventually grew long in the tooth. As those stocks topped, new players in the group appeared on the New America page as they set up in bases of their own. They eventually broke out and bagged their own big gains.
