Lululemon Athletica and Broadcom made Wednesday's IBD Screen Of The Day, a column that focuses on top ideas in the IBD Stock Screener.
Wednesday's stocks to watch come from the "Rising Profit Estimates" screen, which finds companies attracting higher price targets and analyst upgrades.
Installed Building Products also made the list of 227 growth stocks in the screener, and is worth highlighting.
All three of these stocks rank first in their respective IBD industry group.
Stock Screener: Lululemon In Buy Zone After Earnings
IBD 50 stock Lululemon Athletica is in the 5% buy zone of a cup-with-handle base reaching to 389.93, after hitting the 371.36 buy point in April.
Shares popped 12.7% on March 29, following better-than-expected January-ended quarterly earnings and sales. Management gave Q1 and full-year earnings and revenue guidance above analysts' forecasts.
The yoga-inspired apparel retailer posted 31% earnings per share growth and 30% sales growth in Q4. Analysts expect 14% annual earnings growth in fiscal 2024, rising to 16% in 2025. Analysts have raised those estimates.
TD Cowen on April 27 raised its price target on the athleticwear stock to 525 from 500 and maintained its outperform rating. BofA Securities reiterated its buy rating on April 20.
Stock Screener Selects Broadcom
Broadcom is in a flat base with 648.60 buy point. Shares are below the 50-day moving average for a second time in the base, although the base is still intact.
The company launched its Jericho3-AI networking chip on April 18. The chip boasts faster job completion, more bandwidth and lower power usage than the previous-generation chip.
The tech company is on track to acquire cloud computing company VMware in the fall of this year. The $61 billion deal is under scrutiny by regulators, but VMware's CEO Rangarajan Raghuram expects it to go through.
Broadcom beat its top and bottom line estimates for its January-ended quarter on March 2. The stock popped 5.7% in heavy volume the next day.
Broadcom posted 23% EPS growth and 16% sales growth in its Q1 report. Analysts forecast a modest 1% growth in fiscal 2023, following a whopping 34% growth in 2022, then rising 7% in 2024.
AVGO pays a 3% annualized dividend yield to shareholders.
Insulation Installer Stock In Buy Zone Ahead Of Earnings
Lastly, Installed Building Products is in the buy range of a cup base that stretches to 127.79 from a 121.70 buy point.
The insulation and building products installation company reports first-quarter earnings Thursday before the bell.
On Feb. 22, it beat both Q4 EPS and revenue projections, sending shares up 7.3% in heavy volume, and another 3.1% the following day. The company posted accelerating quarterly EPS growth of 71% in Q4, up from 68% and 56% the prior two quarters. Fourth quarter sales growth pulled back to 29%, from 41% and 39%.
Installed Building Products specializes in installing insulation, gutters, garage doors, fireplaces and blinds. The company acquired Anchor Insulation in March for an undisclosed amount. The deal is expected to add $39 million in annual revenue.
Analysts estimate $8.04 annualized 2023 EPS, a drop of 10% from the huge 65% increase in 2022, then flat earnings in 2024.
IBP has gained 44% this year and is about 2% off its 52-week high, as building-products stocks have outperformed.
Installed earned the highest possible 99 score on its IBD Composite Rating and EPS Rating, as seen in the stock screener.
Follow Kimberley Koenig for more stock news on Twitter @IBD_KKoenig.
