3 Stocks That Historically Soar in the Second Half
2023.07.05 05:54
- S&P 500’s +10% H1 rise usually leads to a positive performance in H2
- And certain stocks, on average, outperformed the S&P 500 by +35.5% in the second half following the index’s rise
- Let’s take a look at three such stocks using InvestingPro
- InvestingPro Summer Sale is back on: Check out our massive discounts on subscription plans!
The , though lagging behind the , has performed very well so far this year.
While it’s important to remember that past performance does not guarantee future returns, let’s analyze three stocks that have historically rallied in the second half of the year after the S&P 500 rose more than 10% in the first half.
For that, we will use InvestingPro. By the way, you can now purchase the subscription at a fraction of the regular price as our exclusive summer discount sale has been extended until 07/17/2023!
1. Micron Technology
Founded in 1978 and headquartered in Boise, Idaho, United States, Micron Technology (NASDAQ:) is a leading manufacturer of memory chips for computers. They also market their consumer products under the brand name Crucial Technology and are ranked among the top 5 largest semiconductor manufacturers worldwide.
In the past five instances when the S&P 500 rose more than 10% in the first half of the year, Micron Technology shares experienced an average increase of 60% in the second half, spanning from July 1 to December 31.
Additionally, Micron Technology announced a dividend distribution to its shareholders on July 25. Throughout the year, they will pay out $0.46 per share each quarter ($0.115). To be eligible for this dividend, investors must hold shares before July 7. The dividend yield is 0.73%.
Micron Technology Dividend Payouts
Source: InvestingPro
Mark your calendars for September 26 as Micron Technology is set to present its next earnings report. In the on June 28, the company surpassed expectations with higher-than-anticipated actual revenues.
The strong performance of Micron can be attributed to the increasing demand for its memory chips, primarily driven by the thriving artificial intelligence sector. Looking ahead to the upcoming quarter, the company is optimistic about achieving sales of approximately $4.1 billion.
However, it’s worth noting that recent declines in Micron’s stock can be attributed to new export restrictions imposed by the United States on artificial intelligence chips destined for China.
The Department of Commerce has implemented these measures out of concern over potential risks associated with the use of AI in weapons development and hacking. Consequently, chip shipments to China will be prohibited starting this July.
From a technical perspective, we observe that the first Fibonacci level at $64.80 has proven to be a strong support level, as the price bounced back up from $64.80 to $70.50.
The second Fibonacci level sits at $61.72, coinciding closely with the 200-day moving average. This convergence suggests that it could serve as a potential area for an upward rebound.
Micron Technology Daily Chart
2. KLA
KLA Corporation (NASDAQ:), formerly known as KLA-Tencor Corporation, is a prominent global leader in the design, production, and commercialization of advanced semiconductor production process control and improvement techniques.
In the past five instances when the S&P 500 experienced a rise of more than 10% in the first half of the year, KLA Corporation’s shares demonstrated an average increase of 44% in the second half, spanning from July 1 to December 31.
On April 26, KLA Corporation announced its , surpassing market expectations. The company reported earnings per share (EPS) of $5.49, exceeding the projected EPS of $5.36 by $0.13. The actual earnings also outperformed expectations.
The next earnings report from KLA Corporation is scheduled for July 27.
KLA
Source: InvestingPro
InvestingPro models give it a potential of $498.95.
KLA Models
Source: InvestingPro
From a technical perspective, it is worth noting that KLA Corporation’s stock is currently in a bullish trend. It is moving within an ascending channel and remains positioned above both the 50-day and 200-day moving averages.
This suggests a positive outlook, as the stock has been consistently trading at higher price levels over these periods.
3. Copart
Based in Dallas, Texas, Copart (NASDAQ:) was founded in 1982 by Willis J. Johnson. It has more than 200 physical locations worldwide. It sells wholesale used and repaired vehicles through weekly and bi-weekly online auctions.
The last 5 times the S&P 500 rose more than +10% in the first half of the year, Copart shares rose an average of +52% in the second half of the year, i.e., July 1 to Dec. 31.
The latest presented on May 17 were better than expected, both in actual revenues and earnings per share.
Copart
Source: InvestingPro
The next results will be presented on September 6, and the market expects earnings to increase by almost +11% this fiscal year.
Copart Earnings
Source: InvestingPro
From a technical perspective, Copart’s stock is currently in a bullish trend. It is trading above both its 50-day and 200-day moving averages, indicating positive momentum in the short and long term.
The stock has also managed to overcome resistance levels, suggesting increased buying pressure. In the short term, a price above $89.16 indicates maximum strength.
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Disclaimer: This article was written for informational purposes only; it does not constitute a solicitation, offer, advice, counsel, or recommendation to invest nor is it intended to encourage the purchase of assets in any way.
