Stocks in the News: Google, Priceline Race to $1000

Crista Huff
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Posted: Jul 13, 2013 12:01 AM
Stocks in the News: Google, Priceline Race to $1000

Stocks in the News is produced by Ransom Notes Radio and Goodfellow, LLC. Crista Huff manages Goodfellow LLC, a website that recommends outperforming stocks using fundamental and technical analysis. 

Stock number one is

GlaxoSmithKline PLC, (SYMBOL: GSK) and the headline says:

Thirty Glaxo Employees Under China House Arrest -- Bloomberg

Thirty or more employees of global healthcare company GlaxoSmithKline are under house arrest and surveillance, due to Chinese allegations of bribery and tax fraud.  China reports that some employees confessed to crimes under interrogation, but Glaxo’s own four-month investigation found no evidence of wrongoing.

Earnings are projected to climb 12 and 8 percent for the next two years.  The dividend yield is 4.4%.

Glaxo's stock price continues to recover from the 2008 Financial Meltdown, and could  approach the April 2007 high near $60 this year, but the chart is not definitive.

Our Ransom Note trendline says:  HOLD GLAXOSMITHKLINE.

GSK Chart

GSK data by YCharts

Stock number two is: 

Wells Fargo & Co., (SYMBOL: WFC) and the headline says:

Earnings Beat on Stronger Top-line, Better Credit – Morgan Stanley Research

Bank holding company Wells Fargo reported second-quarter profit of 98 cents per share vs. the consensus estimate of 93 cents, “on stronger mortgage banking, trust and investment fees and lower provisions,” reported Morgan Stanley.

Wells Fargo’s earnings growth estimates have ratcheted upward since their first quarter earnings beat.  Expect another round of upward revisions.

We recommended Wells Fargo on April 12 based on very constructive chart patterns.  The stock is up 15% since then, and the chart remains quite bullish.

Our Ransom Note trendline says: BUY WELLS FARGO.

WFC Chart

WFC data by YCharts

Stock number three is:

Priceline.com and Google Inc., (SYMBOL: PCLN, GOOG) and the headline says:

Priceline, Google in race to $1,000 a share – CNN Money

Shares in Priceline.com and Google Inc. are in a neck-and-neck race to a $1000 share price, currently trading in the low $900’s.

Google is expected to grow earnings 16-18% per year for the next three years.  The stock is up 15% since we began recommending it on April 19.  Priceline is expected to grow earnings 19-23% for the next three years.  The stock is up 17% since we began recommending it on May 13.

We think that Priceline’s stock will pause for a pullback around $950, and foresee Google steadily rising to $1000 to win the race.  Based on current chart patterns,

Our Ransom Note trendline says:  BUY GOOGLE AND HOLD PRICELINE.COM.

GOOG Chart

GOOG data by YCharts