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James Li
James Li
Articles (1322)  | Author's Website |

4 High-Quality S&P Stocks With High 6-Month Total Returns

Stocks with high strength and profitability that have gained more than 30% over the past 6 months

On Wednesday, four high-quality stocks trading on the Standard & Poor’s 500 Index that gained over 30% during the past six months were Nvidia Corp. (NASDAQ:NVDA), Apple Inc. (NASDAQ:AAPL), Illumina Inc. (NASDAQ:ILMN) and Fastenal Co. (NASDAQ:FAST) according to the All-in-One Screener, a popular GuruFocus Premium feature.

Dow continues surge on strong earnings and coronavirus vaccine hopes

The Dow Jones Industrial Average closed at 27,201.52, up 373.05 points from Tuesday’s close of 26,828.47, on the back of The Walt Disney Co. (NYSE:DIS) surging over 8% on strong fiscal third-quarter subscriber growth for its streaming services. Additionally, Johnson & Johnson (NYSE:JNJ) and Novavax Inc. (NASDAQ:NVAX) climbed higher on positive news regarding coronavirus vaccine trials.

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The New Brunswick, New Jersey-based drug manufacturer announced on Wednesday that subsidiary company Janssen Pharmaceutical Companies entered into an agreement with the U.S. government for the manufacturing and delivery of 100 million doses of Janssen’s investigational Covid-19 vaccine. Likewise, Gaithersburg, Maryland-based Novavax said on Tuesday that its investigational vaccine received strong immune responses among Phase 1 trial patients.

GuruFocus Screener receives new "eye" feature

As U.S. market valuations reach elevated levels, with Warren Buffett (Trades, Portfolio)’s favorite market indicator breaking 175%, investors might find opportunities in high-quality companies that have gained over 30% over the past six months, riding the strong momentum.

The new “eye” feature in GuruFocus’ Screener allows the user to view, for example, the six-month total return of all stocks in the high-quality screen. Figure 1 illustrates a screen shot showing the “eye.”

Figure 1

Users can then save the setting as a customized view by clicking the “Edit” button inside the highlighted view in the Views section.

Nvidia

Shares of Nvidia closed at $451.47, returning approximately 81.86% over the past six months.

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GuruFocus ranks the Santa Clara, California-based chipmaker’s profitability 9 out of 10 on several positive investing signs, which include consistent revenue growth over the past 10 years and an operating margin that has increased approximately 13.40% per year on average over the past five years and is outperforming over 95% of global competitors.

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Gurus with large holdings in Nvidia include Spiros Segalas (Trades, Portfolio) and PRIMECAP Management (Trades, Portfolio).

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Apple

Shares of Apple closed at $440.25, gaining approximately 38.07% over the past six months.

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The Cupertino, California-based tech giant broke the $400 share price threshold on July 31 following fiscal third-quarter revenue and earnings growth in the double-digits, outperforming consensus estimates and building on the company’s profitability rank of 10 and GuruFocus business predictability rank of 4.5 stars. Despite this, Apple’s valuation ranks 1 out of 10 on several signs of overvaluation, including price valuations trending near 10-year highs.

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Illumina

Shares of Illumina closed at $400.74, returning more than 33% over the past six months.

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GuruFocus ranks the San Diego-based medical research company’s profitability 10 out of 10 on several positive investing signs, which include a high Piotroski F-score of 7 and an operating margin that has increased approximately 1.30% per year on average over the past five years and is outperforming 94.01% of global competitors.

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Fastenal

Shares of Fastenal closed at $48.06, gaining approximately 30.06% over the past six months.

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GuruFocus ranks the Winona, Minnesota-based industrial distribution company’s profitability 9 out of 10 on several positive investing signs, which include consistent revenue growth and profit margins that are outperforming over 95% of global competitors.

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Bonus: A high-quality stock that has tumbled over 20% over the past six months

With the Screener’s new “eye” feature, we can also look at the high-quality stocks that did not fare as well over the past six months. For example, shares of Intel Corp. (NASDAQ:INTC) closed at $49.82, a loss of approximately 23.94%.

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Like Nvidia, Intel is also a major chipmaker headquartered in Santa Clara, California. While Nvidia’s valuation ranks just 1 out of 10 on several signs of overvaluation, Intel’s valuation ranks 7 out of 10 on the back of price valuations near multiyear lows, including a price-earnings ratio that is near a 10-year low of 8.5 and outperforms 92.16% of global competitors.

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GuruFocus ranks Intel’s profitability 9 out of 10 on several positive investing signs, which include a four-star business predictability rank and an operating margin that has increased approximately 4.10% per year on average over the past five years and is outperforming over 96.40% of global competitors.

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Thirty-one GuruFocus users have placed Intel into the “buying” virtual basket according to the GuruFocus Baskets feature.

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Apple and Biogen Inc. (NASDAQ:BIIB) tie for second place with 14 “buying” votes.

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Disclosure: Author is long Apple, Intel and Biogen.

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About the author:

James Li
I am an editorial researcher at GuruFocus. I have a Master's in Finance from SMU, and I enjoy writing reports on financial trends and investor portfolios. Follow me on Twitter at @JamesLiGuru!

Visit James Li's Website


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