Market News

Weekly Market Review: Stocks Rebound as Quarter nears End

U.S. stocks rallied about 3% on Friday and snapped a recent losing streak. Although markets were closed on Monday, the S&P 500 gained over 6% in the short trading week.

Investors sought value, as many professional traders cleared the decks for the end of the second quarter and the upcoming earnings season in a couple of weeks.

On Thursday, IHS Markit reported that both manufacturing and services activity declined in the U.S. during June.

The Week Ahead

Nike (NKE) will post quarterly results on Monday, followed by General Mills (GIS) Wednesday and Micron (MU) Thursday.

On the economic front, U.S. durable goods orders will be announced on Monday, followed by June consumer confidence on Tuesday.

Wednesday offers a final look at first-quarter GDP growth, while the core PCE price index will be posted on Thursday. The latter is the Federal Reserve’s key inflation metric.

Finally, the Institute for Supply Management will post its June manufacturing data on Friday.

Given a slowing growth outlook and the prospect of higher interest rates, it could become hard to come by investment gains in 2022. As a result, deciding what and when to buy can be challenging for any investor.

However, the fact remains that investments with upside potential and other positive signals are out there if you dig a little deeper.

One such Industrial name is worth a closer look and is our Stock of the Week.

Stock of the Week: Stanley Black & Decker (SWK)

The company makes hand and power tools for both consumer and professional customers, under its flagship brands.

The stock gained nearly 8% last week. It is showing signs that it has the potential to continue this relative outperformance into the second half of 2022. Here’s why:

Stanley Black & Decker is seeing higher demand, as construction activity remains strong on the back end of the coronavirus-related shutdowns. Management is also using the proceeds of selling a non-core business to repurchase stock.

At current levels, the company is priced at just 10.7x expected earnings over the next four quarters. This reflects a discount to both the industry and the broader market.

Wall Street agrees that Stanley Black & Decker has value at current levels. The average price target of 12 active analysts tracked by TipRanks is $152.08, representing 36.8% upside potential.

In the meantime, the company carries an “Outperform” Smart Score of 10/10 on TipRanks. This data-driven stock score is based on 8 key market factors.

On top of the positive aspects mentioned already, the Smart Score indicates that shares have seen improving sentiment from hedge funds and financial bloggers.

FYI: This is just 1 of the 20+ stocks selected for the Smart Investor portfolio, a weekly newsletter that blends big data, and market insights.

Disclaimer: The information contained in this article represents the views and opinion of the writer only, and not the views or opinion of TipRanks or its affiliates Read full disclaimer >

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