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Tickers in this Article: FOSL, HD, M, JCP
Today we will touch on several high-flying stocks and ponder whether it makes sense to hop in now or head for the hills. Incidentally, these companies are companies that have yet to release their earnings.

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Time to Wind this Wristwatch?
Fossil (Nasdaq: FOSL), the Texas-based company famous for its watches, has seen its stock soar over the past year from the teens to more than $40, and it deserved much of the attention it received. After all, the economy has been perking up, which should help boost demand for its wares. The company has also performed well on the earnings front, and has consistently come in ahead of analyst expectations.

However, there are several reasons to be skeptical that the stock will be running much further in the near term. First, because the stock has traveled such a long distance in such a short time, it may be susceptible to some profit taking. Moreover, at 18 times this year's estimate it seems to be at or perhaps approaching fair value. Not to mention that companies that consistently thump expectations run a risk that the investment community may come to expect better-than-expected results each quarter. Finally, if the economy takes a breather, the stock would fall back.

Fossil's management team has done a great job, and there is little doubt that this remains a great brand with a solid future. But at this point in time, there just seems to be better opportunities in this market. Keep an eye peeled for the company's first-quarter results, set to come out May 11. Wall Street expects it to earn 32 cents a share.

Nail It Down
Home Depot (NYSE:HD) is a company that has clearly faced some headwinds because of the economic slowdown. But the stock is now trading near its 52-week high, and it can go higher in the long run. Not only does the company have merchandise that should be in big demand as the economy hits its stride, but it also has been generating some decent earnings recently. As well, HD has beaten the estimate the last four quarters, which is going to make it attractive to various investors.

At this point in time, the estimate for this year is $1.85 a share, and that seems very doable. If the company can exceed that number, interest in the stock could perk up even more and the stock could set new highs. Wall Street expects the company to earn 39 cents a share in the first quarter. That number looks very achievable.

Risky Retail
Sears Holdings Corporation
(Nasdaq:SHLD) is trading near its 52-week highs. But at this point it appears a bit overextended in the near run.

To be clear, and to give credit where it's due, the company is expected to generate a respectable $2.75 a share this year, which is possible. Moreover, it has a good operating history and has proven that it can endure despite difficult economic times in this country. The issue is that it trades at more than 44 times this year's estimate, which seems pricey, when one can theoretically purchase Walmart (NYSE:WMT), a store that has a tremendous reputation and which dominates the land of discount retail, for around 13.6 times this year's estimate.

There is also a question in my mind about where Sears is going to be over the long term. Is it going to focus more on its discount business (Kmart) and be able to successfully build that up, or will it work to drive its Sears brand and to become more competitive with the likes of JCPenney (NYSE:JCP) and Macy's (NYSE:M), or will it do both? Right now, it's hard to tell how things will turn out and how the company might look say a dozen years out. Note that the company is to release its first quarter earnings on May 17. The estimate for the period is 10 cents a share.

Bottom Line
The above are stocks that are doing well. Of these, my favorite is Home Depot. In both the near and the long run the shares could see some upside. The recovering economy and its extensive merchandise selection, and earnings potential are what make me bullish. (For more, see Strategies For Quarterly Earnings Season.)

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