Delta Air had its Relative Strength (RS) Rating upgraded from 68 to 79 Tuesday -- a welcome improvement, but still below the 80 or better score you look for.
When you're researching the best stocks to buy and watch, keep a close on eye on relative price strength.
IBD's proprietary RS Rating identifies market leadership by using a 1 (worst) to 99 (best) score that shows how a stock's price action over the last 52 weeks compares to other publicly traded companies.
Over 100 years of market history shows that the best stocks tend to have an RS Rating of above 80 in the early stages of their moves. See if Delta Air can continue to show renewed price strength and hit that benchmark.
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Delta Air broke out earlier, but is now approximately 4% below the prior 39.72 entry from a cup with handle. If a stock you're watching clears a buy point then falls 7% or more below the original entry price, it's considered a failed base. It's best to wait for the stock to form a new consolidation and breakout. Also understand that the most recent consolidation is a later-stage base, and such bases are more prone to failure.
Earnings growth rose in the company's most recent report from 403% to 573%, but revenue fell from 53% to 42%.
The company holds the No. 2 rank among its peers in the Transportation-Airline industry group. Copa Holdings is also among the group's highest-rated stocks.
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