Stock Market Desk: When you’re looking for the best stocks to buy and watch, keep a close eye on what the best mutual funds are buying. One name these top money managers have focused on is medical supplies stock West Pharmaceutical Services (WST).
West Pharmaceutical has seen 52 funds with an A+ rating from IBD take a position in the stock. Among them is T. Rowe Price New Horizons (PRNHX), a perennial fixture on the IBD Mutual Fund Index. For the best mutual funds to invest in a stock like West Pharmaceutical, the company needs to pass muster with their teams of research analysts.
T. Rowe Price also owns shares in diabetes stock DexCom (DXCM), which makes continuous glucose monitoring systems. This top-rated fund also takes positions in newer IPO stocks, such as DocuSign (DOCU). West Pharmaceutical, DexCom and DocuSign are all trading near new all-time highs, even in the face of the volatile coronavirus stock market.
As you should regularly check features that help maintain your list of stocks to watch, also note that West Pharmaceuticals and DexCom stock are both on the IBD Breakout Stocks Index.
Based in Pennsylvania, West Pharmaceutical develops injectable drug-delivery systems and packaging for the health care and consumer markets. With locations in North and South America, Europe, Asia and Australia, the company posted revenue of $1.84 billion in 2019.
Over the last three years, West Pharmaceuticals has grown earnings at an average annual pace of 16%. Average yearly sales growth stands at 7%. The company’s annual pretax profit margin is 16% and its return on equity comes just shy of 17%.
West Pharmaceutical is scheduled to post Q1 earnings on April 23 before the stock market opens. Analysts expect quarterly EPS growth to slow from 12% in Q4 to 11%.
In the aftermath of the coronavirus crash and economic lockdowns, analysts are looking for, in general, a dismal Q1 earnings season.
It’s always risky to buy stocks just before they report earnings, and that’s particularly true in the current environment. But keep an eye on West Pharmaceutical to see how it reports — and how Wall Street reacts.
West Pharmaceutical Trying To ‘Handle’ Coronavirus Stock Market
West Pharmaceutical is trying to retake the 167.93 buy point it briefly cleared from a cup with handle on April 15.
The stock has floated in and out of the buy zone in tepid volume over the last several days as its Q1 earnings report nears. See if strong — or, at least, less bad than expected — numbers can lift West Pharmaceuticals back into the buy zone.
If the stock does clear the buy point, look for volume at least 40% higher than normal. Should that happen, continue to exercise caution. The stock market follow-through day on April 2 has signaled a nascent uptrend, but we’re not out of the woods yet.
After the sharp coronavirus market crash, it’s certainly possible that more time will be needed to establish a lasting uptrend. In the meantime, continue to track what the best mutual funds are doing and monitor West Pharmaceutical and other top-rated stocks to watch.
In early trading Wednesday, West Pharmaceuticals is coming off its lows and trying to edge higher. The stock is currently trading around 1% below the buy point. The IBD Breakout Opportunities ETF from Innovator Capital Management tracks the IBD Breakout Stocks Index. As with other index ETFs, this allows you to essentially invest in the entire index in addition to or rather than buying individual stocks. Learn more about the ETF and Innovator funds.
