Stocks in Motion

Attention momentum investors!  Newton’s Laws tell us that objects in motion tend to stay in motion.  This applies to stocks going down, stocks going up, and also stocks experiencing repetitive motion, a.k.a. trading ranges. I usually write about “buy low” opportunities within such trading ranges, but today I’d like to point out some “objects in motion” — a.k.a. stocks — which are bucking the market and possibly breaking out on the upside.

Copa Holdings (CPA, $67.46) is a Latin American provider of airline passenger and cargo service in Panama, Colombia, Venezuela and Ecuador. CPA is projected to have earnings (EPS) growth of 65% through fiscal year 2013, and the stock pays a dividend of 2.4%.

The stock rose to a trading range of $61 to $70 since early May 2011 and did not suffer through recent summer doldrums in the stock market. There’s some price resistance at $70 as the stock re-visits its 2007 highs, but considering its earnings momentum and share price outperformance, I would be happy to buy this stock at $66 or $67 and wait for the next breakout.

Visa (V, $91.42) is a global payments technology company that connects consumers, businesses, banks and governments in more than 200 countries and territories. The company is projected to have earnings (EPS) growth of 67% through fiscal year 2013.

Visa stock fully recovered from the 2008 Financial Meltdown, reached a new high, established a new trading range of $66 to $96 during the last 18 months, and now appears to be completing that trading range in preparation for another move upwards. I would buy Visa on any down day in the market for a good growth stock opportunity.

Kimberly-Clark (KMB, $69.29) is a global consumer products company which manufactures diapers, paper towels, tissues and more. Corporate net income is projected to grow 23% through fiscal year 2013.

The stock has recently broken past resistance at $68. The next stop on its upward climb should be at $72 as it re-visits its 2007 highs.  There will be some price resistance there as frustrated people who’ve owned the stock for four years will be selling, causing the price to bounce around a bit in the $68-$72 area. But there aren’t too many of those people, because KMB has outperformed most other stocks relative to the 2008 Financial Meltdown, AND investors are receiving a 4% dividend.

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