Companies that produce personal products have been showing relative strength over the last year, outperforming the S&P 500, and in some cases by big margins. Over the last year, the SPDR S&P 500 (NYSE:SPY) ETF is down 2.42% and has struggled to stay in positive territory since the August decline. Therefore, if you do find stocks that are still performing well in a tough overall market environment, they are likely to provide relative safety and also potentially outperform as the S&P 500 continues to battle its way out of negative returns.

Estee Lauder (NYSE:EL) is up 37.05% in the last year, to $110.50 from $79.13. The stock broke aggressively above $110 in November, and after making a 52-week high at $120.73, it has been moving between that high and $105. So far, $105 is holding as support, providing a potential buying opportunity, with a stop below $105 (close to 50-day moving average) or alternatively below $100 (close to 200-day moving average). Former resistance between $100 and $105 should now act as support, therefore, a move back below $100 is a warning signal. If the stock can move back above the 52-week high at $120.73, the target is $135. (For more, see Analyzing Chart Patterns.)

Kimberly Clark (NYSE:KMB) is up 13.05% over the last year, to $71.28, from $63.05. The stock made a 52-week high in October at $73.23 but quickly pulled back. Since then it has been moving between $72 and $67. A break out above $72 indicates the high will likely be tested. A breakout above the high provides a profit target of $78. If the stock continues to range, the stock can be purchased between $69 and $67 with a stop loss below $67. $67 should provide support, if it does not, it is a warning signal of further declines.

Colgate Palmolive (NYSE:CL) is up 14.67% over the last year, to $92.12, from $80.44. After making a September high at $94.89, the stock has been consolidating above $85 creating a downward sloping triangle. Buying along support of the triangle can provide a low risk entry point as a stop be placed around $85. The 200-day moving also provides support just above $85. If this level is broken though it indicates a downside break of the triangle and could mean significant declines. A move above $92 on the other hand breaks the triangle to the upside, providing a profit target of $100 to $101.

Procter Gamble (NYSE:PG) is just slightly positive for the year, but has been consolidating between a May high at $67.72 and a August low at $57.56. This has created a large triangle, the breakout of which could determine the longer-term direction of the stock. If the stock moves above $66, it indicates an upside breakout and re-test of the 52-week high at $67.72. If the high is exceeded, the profit target is $76. On the other hand, a drop below $61 breaks the pattern to the downside and indicates a further decline. On-balance volume has already broken to the upside and is in a strong uptrend - this is a positive indicator for the stock.

The Bottom Line
Personal product companies have been doing well relative to the market in this environment. As the S&P 500 remains negative for the year, these stocks have shown relative strength and provide some safety. That said, each stock has a support level which many do hold. A break of support means the stock could succumb to further declines. On the other hand, the strength these stocks have already shown means that if resistance is broken, there is still significant upside potential. (For more, see Technical Analysis: Introduction.)

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

Charts courtesy of stockcharts.com

At the time of writing, Corey Mitchell did not own shares in any of the companies mentioned in this article.

Related Articles
  1. Mutual Funds & ETFs

    ETF Analysis: ProShares UltraPro Nasdaq Biotech

    Obtain information about an ETF offerings that provides leveraged exposure to the biotechnology industry, the ProShares UltraPro Nasdaq Biotech Fund.
  2. Mutual Funds & ETFs

    ETF Analysis: iShares MSCI Europe Financials

    Learn about the iShares MSCI Europe Financials fund, which invests in numerous European financial industries, such as banks, insurance and real estate.
  3. Mutual Funds & ETFs

    ETF Analysis: SPDR S&P Insurance

    Learn about the SPDR S&P Insurance exchange-traded fund, which follows the S&P Insurance Select Industry Index by investing in equities of U.S. insurers.
  4. Mutual Funds & ETFs

    ETF Analysis: SPDR S&P Emerging Markets Small Cap

    Learn about the SPDR S&P Emerging Markets Small Cap exchange-traded fund, which invests in small-cap firms traded at the emerging equity markets.
  5. Mutual Funds & ETFs

    ETF Analysis: ETFS Physical Platinum

    Learn about the physical platinum ETF. Platinum embarked on a bull market from 2001 to 2011, climbing to record prices along with other precious metals.
  6. Mutual Funds & ETFs

    ETF Analysis: iShares MSCI Turkey

    Learn about the iShares MSCI Turkey exchange-traded fund, which invests in a wide variety of companies' equities traded on Turkish exchanges.
  7. Mutual Funds & ETFs

    ETF Analysis: PowerShares S&P 500 Downside Hedged

    Find out about the PowerShares S&P 500 Downside Hedged ETF, and learn detailed information about characteristics, suitability and recommendations of it.
  8. Mutual Funds & ETFs

    ETF Analysis: Guggenheim Enhanced Short Dur

    Find out about the Guggenheim Enhanced Short Duration ETF, and learn detailed information about this fund that focuses on fixed-income securities.
  9. Mutual Funds & ETFs

    ETF Analysis: iShares US Oil&Gas Explor&Prodtn

    Learn about the iShares U.S. Oil & Gas Exploration & Production ETF, which provides an efficient way to invest in the exploration and production sector.
  10. Mutual Funds & ETFs

    ETF Analysis: iShares Morningstar Small-Cap Value

    Find out about the Shares Morningstar Small-Cap Value ETF, and learn detailed information about this exchange-traded fund that focuses on small-cap equities.
RELATED TERMS
  1. Exchange-Traded Fund (ETF)

    A security that tracks an index, a commodity or a basket of assets ...
  2. Exchange-Traded Mutual Funds (ETMF)

    Investopedia explains the definition of exchange-traded mutual ...
  3. Fintech

    Fintech is a portmanteau of financial technology that describes ...
  4. Indicator

    Indicators are statistics used to measure current conditions ...
  5. Intraday Momentum Index (IMI)

    A technical indicator that combines aspects of candlestick analysis ...
  6. Lion economies

    A nickname given to Africa's growing economies.
RELATED FAQS
  1. What assumptions are made when conducting a t-test?

    The common assumptions made when doing a t-test include those regarding the scale of measurement, random sampling, normality ... Read Full Answer >>
  2. What does a high turnover ratio signify for an investment fund?

    If an investment fund has a high turnover ratio, it indicates it replaces most or all of its holdings over a one-year period. ... Read Full Answer >>
  3. Does index trading increase market vulnerability?

    The rise of index trading may increase the overall vulnerability of the stock market due to increased correlations between ... Read Full Answer >>
  4. What is the difference between passive and active asset management?

    Asset management utilizes two main investment strategies that can be used to generate returns: active asset management and ... Read Full Answer >>
  5. How are double exponential moving averages applied in technical analysis?

    Double exponential moving averages (DEMAS) are commonly used in technical analysis like any other moving average indicator ... Read Full Answer >>
  6. Is there a situation in which wash trading is legal?

    Wash trading, the intentional practice of manipulating a stock's activity level to deceive other investors, is not a legal ... Read Full Answer >>

You May Also Like

COMPANIES IN THIS ARTICLE
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!