The indices continue to look good as a number of high-flying stocks are pulling back to support and giving investors an opportunity to buy at lower prices. Based on both technicals and fundamentals, these five stocks could be positive buys in the next week. (For related reading, take a look at Fundamentals And Technicals: Together At Last.)
IN PICTURES: 20 Tools For Building Up Your Portfolio

On the Radar
Skyworks Solutions (Nasdaq:SWKS) is a chip company that supplies semiconductors to cellular devices, including the Apple (Nasdaq:AAPL) iPhone. The stock has had a big run in 2010, however it has pulled back over the last couple of weeks. Not only is the stock technically sound, the earnings are there to back up the buy recommendation. The company reported 56 cents per share in earnings in 2009 (year ending October 2, 2009), and the First Call estimate for 2010 is $1.22, followed by $1.54 in 2011. That is average annual growth of around 50% over the two-year span. Based on 2010 earnings estimates, the stock is trading with a P/E ratio of 17.4; this is too low for a growth story like SWKS. A good buy point is near $21 per share.

A Solid Leader
Decker's Outdoors (Nasdaq:DECK) is the maker of the always-popular UGG sheepskin boots that are consistently a top seller during the holiday season. The company recently broke out of a consolidation pattern on heavy volume, prompting the stock to move to the buy list. Fundamentally, the stock is trading with a P/E ratio of 15.1 based on the First Call earnings estimate of $3.52 per share in 2010. Based on past holiday seasons, DECK has been a leader in the retail sector and there is no reason why it should not continue its solid performance into the end of the year.

Broadcasting a Bright Future
American Tower Corp (NYSE:AMT) is considered a broadcast and communications infrastructure company, but is more well-known for its growing number of wireless communication towers. As the demand for more data via wireless devices increases, the demand for more towers to transmit the data will benefit AMT. The stock recently pulled back from a 10-year high and is finding support in the $49-50 area. Fundamentally, the stock is not cheap, with a forward P/E ratio of 46.4. However the demand for AMT's towers should continue to grow substantially in the future.

Open the Gates
iGATE (Nasdaq: IGTE) provides IT outsourcing solutions around the globe to help clients optimize their businesses. The stock hit a 10-year high in mid-September and has since been consolidating above support in the $17-18 range. The bullish volume coupled with the consolidation make IGTE a buy, according to technicals. Fundamentally, the stock is trading with a forward P/E ratio of 19.14, which is impressive for a stock in a growth sector.

Within Arm's Reach
ARM Holdings (Nasdaq:ARMH) is a chip stock that claims to be the world's leading provider of physical semiconductor intellectual property. The stock has more than doubled in 2010 on the back of smartphones and TVs. After hitting a 10-year high in September, the stock is down 10% and now a buy candidate on the pullback. Fundamentally, the stock is not a bargain with a forward P/E ratio of 40.9. However, the sector warrants an abnormally high valuation.

The Bottom Line
Make sure to complete your own due diligence before proceeding with buying any of the stocks mentioned. What works for one investor might not fit in another's portfolio.

Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!

Related Articles
  1. Investing News

    Bank Stocks: Time to Buy or Avoid? (WFC, JPM, C)

    Bank stocks have been pounded. Is this the right time to buy or should they be avoided?
  2. Stock Analysis

    Why the Bullish Are Turning Bearish

    Banks are reducing their targets for the S&P 500 for 2016. Here's why.
  3. Stock Analysis

    How to Find Quality Stocks Amid the Wreckage

    Finding companies with good earnings and hitting on all cylinders in this environment, although possible, is not easy.
  4. Investing News

    What You Can Learn from Carl Icahn's Mistakes

    Carl Icahn has been a stellar performer in the investment world for decades, but following his lead these days could be dangerous.
  5. Stock Analysis

    Analyzing Altria's Return on Equity (ROE) (MO)

    Learn about Altria Group's return on equity (ROE) and analyze net profit margin, asset turnover and financial leverage to determine what is causing its high ROE.
  6. Investing News

    Icahn's Bet on Cheniere Energy: Should You Follow?

    Investing legend Carl Icahn continues to lose money on Cheniere Energy, but he's increasing his stake. Should you follow his lead?
  7. Stock Analysis

    Analyzing Google's Return on Equity (ROE) (GOOGL)

    Learn about Alphabet's return on equity. How has its ROE changed over time, how does it compare to its peers and what factors are driving ROE for the company?
  8. Investing News

    Is Buffett's Bet on Oil Right for You? (XOM, PSX)

    Oil stocks are getting trounced, but Warren Buffett still likes one of them. Should you follow the leader?
  9. Investing News

    Chipotle Served with Criminal Probe

    Chipotle's beat muted expectations and got a clear bill from the CDC, but it now appears that an investigation into its E.coli breakout has expanded.
  10. Stock Analysis

    Analyzing Sprint Corp's Return on Equity (ROE) (S)

    Learn about Sprint's return on equity. Find out why its ROE is negative and how asset turnover and financial leverage impact ROE relative to Sprint's peers.
RELATED FAQS
  1. How do dividends affect retained earnings?

    When a company issues a cash dividend to its shareholders, the retained earnings listed on the balance sheet are reduced ... Read Full Answer >>
  2. What is the difference between called-up share capital and paid-up share capital?

    The difference between called-up share capital and paid-up share capital is investors have already paid in full for paid-up ... Read Full Answer >>
  3. Why would a corporation issue convertible bonds?

    A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
  4. How does additional paid in capital affect retained earnings?

    Both additional paid-in capital and retained earnings are entries under the shareholders' equity section of a company's balance ... Read Full Answer >>
  5. What types of capital are not considered share capital?

    The money a business uses to fund operations or growth is called capital, and there are a number of capital sources available. ... Read Full Answer >>
  6. What is the difference between issued share capital and subscribed share capital?

    The difference between subscribed share capital and issued share capital is the former relates to the amount of stock for ... Read Full Answer >>
COMPANIES IN THIS ARTICLE
Trading Center