Heading into each week, I will sift through hundreds of charts and build a watch list of stocks and ETFs that could be potential buying opportunities. After the list is created, the next step involves analyzing the fundamentals behind each stock and how they compare with the overall market and competitors.
TUTORIAL: Stock Basics

This week there were a large number of stocks that look attractive after the overall market pullback that occurred over the last few days. Stocks that were hitting new highs have pulled back to levels that are once again buying opportunities. Here are five stocks that caught my eye.

MasTec (NYSE:MTZ) is a specialty contractor in the U.S. that focuses on utility and communications infrastructure. They build everything from wind and solar farms to installing underground communication wires. The stock hit a 10-year high in late April on heavy buying before pullback to near the $21 area. With a forward P/E ratio of only 14 and price-to-sales of 0.8, the company is not only attractive from a technical perspective, but also fundamentally. Add in the exposure to alternative energy with oil above $100 per barrel and MTZ is at the top of this list.

A stock my financial group has owned in the past and is looking at again is Brazilian water utility Companhia de Saneamento Basico do Estado de Sao Paulo (NYSE:SBS). The company offers water and sewage services to customers in the state of Sao Paulo in Brazil. The stock hit a new all-time high in April and has since been consolidating between $58 and $60 per share. The action has been bullish and offering investors an opportunity to buy SBS before the next breakout. Fundamentally, SBS trades with a forward P/E ratio of 6.7, which is low even for a water utility. Exposure to Brazil and the water sector make SBS an attractive long-term investment.

SeaCube Container Leasing (NYSE:BOX) is a U.S.-based company that offers shipping containers via lease or purchased. The containers service both shipping lines as well as rail and trucking companies. The stock went public in late October 2010 and has been on a straight move higher, up 50% from its first day of trading. Add in the 5.6% annual dividend and investors in BOX have been all smiles. With that being said, I feel there is more upside potential for BOX and buying near $16 gives the stock an attractive forward P/E ratio of 7.2.


Informatica Corporation (NASDAQ:INFA) calls itself the data integration company because they help companies via software and services to utilize their data in a timely and relevant manner. The stock rose to the best level in over a decade on the first day of May before pulling back to the 50-day moving average at $50, where it found support. Even with the great chart, INFA is considered an aggressive stock play because it is valued with a forward P/E ratio of 32 and price-to-sales of 8.5. The key to buying a stock such as INFA is keeping a narrow stop-loss in the event the stock breaks the current uptrend.

The Bottom Line
The reason the four stocks above were mentioned is a combination of both fundamentals and technicals. The charts will likely drive the short-term action, and the long-term performance is more a result of the underlying fundamentals. Buying on the pullbacks we highlighted increases the odds of picking a winner. Setting predetermined stop-loss orders to protect against big losses is also integral in long-term investment success.

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

Related Articles
  1. Stock Analysis

    Will J.C. Penney Come Back in 2016? (JCP)

    J.C. Penney is without a doubt turning itself around, but that doesn't guarantee the stock will respond immediately.
  2. Stock Analysis

    Allstate: How Being Boring Earns it Billions (ALL)

    A summary of what Allstate Insurance sells and whom it sells it to including recent mergers and acquisitions that have helped boost its bottom line.
  3. Options & Futures

    Cyclical Versus Non-Cyclical Stocks

    Investing during an economic downturn simply means changing your focus. Discover the benefits of defensive stocks.
  4. Investing Basics

    How to Deduct Your Stock Losses

    Held onto a stock for too long? Selling at a loss is never ideal, but it is possible to minimize the damage. Here's how.
  5. Economics

    Is Wall Street Living in Denial?

    Will remaining calm and staying long present significant risks to your investment health?
  6. Stock Analysis

    When Will Dick's Sporting Goods Bounce Back? (DKS)

    Is DKS a bargain here?
  7. Investing News

    How AT&T Evolved into a Mobile Phone Giant

    A third of Americans use an AT&T mobile phone. How did it evolve from a state-sponsored monopoly, though antitrust and a technological revolution?
  8. Stock Analysis

    Home Depot: Can its Shares Continue Climbing?

    Home Depot has outperformed the market by a wide margin in the last 12 months. Is this sustainable?
  9. Stock Analysis

    Yelp: Can it Regain its Losses in 2016? (YELP)

    Yelp investors have had reason to be happy recently. Will the good spirits last?
  10. Stock Analysis

    Is Walmart's Rally Sustainable? (WMT)

    Walmart is enjoying a short-term rally. Is it sustainable? Is Amazon still a better bet?
  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 >>

You May Also Like

Trading Center