Tecnoglass, HubSpot and Fortinet are three growth stocks with bullish charts that are in a selective and rarely seen IBD stock screener.
The three are part of a handful of growth stocks in the stringent Fundamental Strength screen in IBD MarketSmith. It uses the MarketSmith Growth 250 as its basis.
These Growth Stocks Make The Grade
The stock screener narrowed the Growth 250 list down to six stocks Tuesday, with three in desirable chart patterns. That gives them an appealing mix of technical and fundamental characteristics.
Tecnoglass has been riding its rising 10-week moving average since November. Tecnoglass posted better-than-expected Q4 earning per share and sales in early March, lifting the stock 9.9% in heavy volume.
The architectural glass and window manufacturer in Q4 posted 118% EPS growth, slipping slightly from 124% growth in the prior quarter. Quarterly sales grew 60%, up from 53% in the prior quarter.
Shares pulled back and tested the 10-week line last week, giving investors a new buying range from 36.25 to 39.89.
TGLS has gained over 26% this year so far, and is up about 50% from its November breakout from a cup base.
Annual EPS grew an impressive 93% in 2022, with analysts projecting 17% growth in 2023. Tecnoglass holds a 79% three-year EPS growth rate, according to IBD Stock Checkup.
Stock Screener Finds Cloud Stock In New Base
HubSpot is in a flat base with a 418.49 buy point. Shares broke out of a prior cup-with-handle base on Feb. 17 after HubSpot released stronger-than-expected Q4 EPS and sales. Management also gave positive Q1 and full-year EPS and sales forecasts.
But a day after the growth stock gapped up on the news, it faded into the current base.
HubSpot posted strong Q4 EPS growth of 91%, accelerating from 38% and 2% gains in the prior two quarters. Analysts forecast 46% EPS growth for this year and 30% in 2024.
The company provides a cloud-based customer relationship management (CRM) platform. HUBS is getting noticed as it works on its artificial intelligence technology.
Cybersecurity Stock In Buy Zone
Fortinet passed a 63.12 handle buy point and is in the 5% buy zone to 66.28. The base is within a much larger pattern.
The cybersecurity and network stock's relative strength line hit a new high, as indicated by the blue dot on the MarketSmith charts.
Fortinet posted accelerating Q4 EPS growth of 76%, up from 65% and 26% in the prior quarters. Quarterly sales growth has been consistent, ranging from 29% to 34% in the last four quarters.
Honorable mention stocks that made the elite six include Lantheus Holdings, Super Micro Computer and Allegro MicroSystems.
Growth Stock Screener Criteria
The Fundamental Strength screen is found under MarketSmith's group of Growth 250 lists. The stock screener looks for six profitability and sales criteria:
- Latest quarterly EPS growth at least 40% over prior year's quarter.
- Prior quarter's EPS growth at least 25% over prior year's quarter.
- Latest quarterly sales growth at least 40% over prior year's quarter.
- Annual three-year EPS growth at least 25%.
- Annual EPS growth at least 25% over the prior year.
- Prior year's annual EPS growth at least 15% higher than previous year.
Follow Kimberley Koenig for more stock news on Twitter @IBD_KKoenig.
