No. 1 ranked wireless broadband services provider T-Mobile US just phoned in a big ratings jump. Its stock Relative Strength (RS) Rating climbed from 78 to 86 Tuesday, passing a key threshold on the way.
The new 86 RS Rating means T-Mobile stock has outperformed 86% of all companies on stock price performance over the past year. Why is this a big deal? Market research shows that the best stocks tend to have an 80 or higher RS Rating as they launch their biggest runs.
T-Mobile Stock Composite In top 13%
Other key ratings for the Bellevue, Wash.-based company are also strong. For example its 90 EPS Rating puts it in the top 10% of stocks for recent and long-term profit growth. And it has an 87 Composite Rating. One yellow flag: Its C- Accumulation/Distribution Rating, a gauge of institutional investing in a stock, shows a bit more selling than buying.
See How IBD Helps You Make More Money In Stocks
Although the market is still in correction and it's not a great time to buy, it is a great time to spruce up stock watchlists in preparation for the inevitable day the market turns upward. The biggest gains often come at the very beginning of a new bull run. And T-Mobile stock is a good watchlist candidate. It's working on a cup with handle with a 135.25 entry. See if the stock can break out in heavy volume.
T-Mobile reported a 53% surge in earnings last quarter, on a year-over-year basis, to $1.41 per share. It was the strongest profit growth in at least a year. Sales rose a mild 2% to $20.1 billion.
T-Mobile stock holds the No. 1 rank among its peers in the Telecom Services-Wireless industry group. The group ranks No. 48 on IBD's list of 197 industries. That puts it just inside the top quartile of all stocks on the list. And it's up dramatically from a weak 133 rank three months ago.
When looking for the best stocks to buy and watch, one factor to watch closely is relative price strength.
IBD's proprietary RS Rating tracks market leadership by showing how a stock's price movement over the last 52 weeks compares to that of other stocks on the major indexes.
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