Dow Jones stock leader Procter & Gamble made Wednesday's IBD Screen Of The Day, a column that focuses on top ideas in the IBD Stock Screener, after a breakout move.
Wednesday's stocks to watch come from the "Rising Profit Estimates" screen, which finds issues attracting higher price targets and analyst upgrades. In addition to PG stock, the latest screen has also highlighted Chipotle Mexican Grill and Lululemon Athletica.
Dow Jones Stock Tops Buy Point
Dow Jones stock leader Procter & Gamble broke out past a 154.90 cup-with-handle buy point last week, according to IBD MarketSmith chart analysis. Shares dropped 1% Wednesday afternoon even after Barclays maintained its overweight rating and raised its price target from 160 to 167. The 5% buy zone goes up from the buy point to 162.65.
On Friday, shares rallied 3.5% after the company posted strong fiscal third-quarter earnings. Procter & Gamble earned $1.37 a share on sales of $20.1 billion — respective year-over-year increases of 3% and 4%.
The company raised prices by about 10% across its various brands in the March quarter vs. a year ago. It was the second consecutive quarter with a 10% year-over-year increase, as the company passed along higher costs and widened its profit margins.
For 2023, P&G earnings are expected to rise 1% before climbing another 9% in 2024.
Amid steady fundamentals and solid price gains in recent months, P&G stock shows a good-but-not-great 93 out of 99 IBD Composite Rating, according to IBD Stock Checkup.
Chipotle Surges On Earnings
Late Tuesday, Chipotle Mexican Grill delivered a major first-quarter surprise.
Chipotle earnings rocketed 84% to $10.50 per share on a 17% revenue jump to $2.36 billion. Wall Street expected Chipotle to earn $8.95 per share on 16% revenue growth to $2.34 billion. Chipotle's earnings are expected to grow 28% in 2023 and 22% in 2024.
In the earnings call, executives said a training program is helping to improve restaurant service. Chipotle is expanding testing of new quicker-cooking clamshell grills, among other initiatives. It is also considering new menu items.
Chipotle expects to open 255 to 285 new restaurants this year after opening 41 locations in Q1. The company forecasts Q2 and full-year comparable sales growth in the middle- to high-single digits.
CMG stock surged 14% Wednesday midday, far out of the buy zone past a 1,724.81 cup-base buy point.
Lululemon Holds Above Recent Buy Point
Outside of the Dow Jones Industrial Average, IBD Leaderboard stock Lululemon gave up a large part of its gains past a 371.36 entry after a 2.2% drop Tuesday. But the stock held above its buy point and rebounded 0.4% Wednesday midday.
Shares are in a buy range that runs up to 389.93. Keep in mind that the new uptrend under pressure should put investors more on the defensive.
On March 28, Lululemon hiked 2023 guidance after topping earnings and revenue estimates for the holiday fourth quarter, sparking a 12.7% surge on March 29. The yogawear and athleisure apparel retailer's final fourth-quarter results also exceeded its own preliminary announcement, issued in early January.
Lululemon earnings are expected to rise 15% in the fiscal year ending next January and another 16% in the next fiscal year.
