Finding fresh stock selections is no easy task in a market that's been rallying for three months. Investors eventually tend to overbuy when stocks are rising — and oversell when the market heads down.
Today, the pickings have proved thin as we screen hundreds of stocks for superior growth potential at reasonable prices. That said, we've still found stocks with unusual promise. Here's an overview of 6 of our new buys.
Alexion Pharmaceutical (ALXN)
This is a comeback stock that was previously a big winner of of ours but tumbled from $115 to $90 last fall. Now it is breaking back above its 10-week moving average with 33% a year expect- ed earnings growth and Strong Buy ratings from 14 of the 19 analysts covering it.
Allegiant Travel (ALGT)
Serving small-city U.S. travel destinations with planes and travel services, ALGT shares have been on the rise from $40 to $90 over the past 18 months, yet trade at just 14 times earnings that are estimated to grow 22% a year. Its PEG ratio is 0.62.
CVS Caremark (CVS)
A giant pharmacy healthcare provider whose shares have doubled almost non-stop since August 2010, CVS trades at 12 times forward earnings that are growing at a moderate but steady 14% a year.
D.R. Horton (DHI) and Ryland Group (RYL)
Homebuilding stocks came back last fall and winter only to tumble anew in March. The nascent upturn in housing has not yet reached their bottom lines, but some analysts' five-year earnings projections run as high as 30% to 40% a year. Yet their P/E and PEG valuations are quite modest in view of their long-run potential.
Radian Group (RDN)
his small-cap provides mortgage insurance and financial guaranty services to mortgage lenders. The stock has run from 7 to 10-plus, but if it breaks upside resistance at 10.95 RDN could go to 14 or higher. At just 7 its P/E could be upgraded.
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