Last Monday, as I do each and every Monday – I gave you three stocks I was watching for stock surge breakouts.
Genco Shipping (GNK) made its move on Wednesday, triggering my entry price at $17.00.
If you followed my advice, you are up 10.5% in three days and climbing. And the stock is up overall from last Monday to now by 14.22%
ADTRAN (ADTN) also began to move on Monday and into Tuesday, climbing over 8% before settling back a bit.
ADTRAN Price Source Bloomberg
Athene Holding (ATH) was the third stock added last Monday – and it still made the cut for my watch list for this week as you’ll read about in a moment.
New Watch List
Here are the stocks that I’m watching this week:
Build-A-Bear Workshop (BBW)
Build-A-Bear Workshop (BBW) is the Saint Louis-based company founded by the very impressive Maxine Clark who wanted to provide children and their paying parents with experiences from her youth and her love of Teddy Bears. The stores are now ubiquitous in malls around the US – offering children the ability to “build” customized bears and other stuffed toys.
- Surge score: 99/100
- % Above 52-wk low: 948%
- MFI reading: 77
- Sales growth: +97%
- Triple momentum: YES
Build-A-Bear has been an absolute monster this year. Shares are up 327.17% year-to-date.
With a Surge Score of 99/100, BBW is one of the strongest stocks in the market – the 99th percentile for price performance.
It’s easy to see why.
Sales were up 97% last quarter.
And the company has beaten earnings expectations by several hundred percent the last three quarters in a row.
After a powerful move at the end of May, shares are now consolidating in a tightening pattern.
The high is $19.72, and I will likely buy on a break of that level.
The only tricky part with this trade is the stop loss. I’d like to play this one a little looser with a stop around $16.00, but I’m not willing to risk 19% on any trade. So, I will play it tighter with a stop at $18.00.
If the breakout comes on high volume, price should not retrace back into its consolidation zone.
Reliant Bancorp (RBNC)
Reliant Bancorp (RBNC) is a Brentwood, Tennessee-based banking company. It offers the traditional commercial and consumer banking services including deposits, loans and other services. Deposit growth is up strongly by 62.80% and loans are equally impressive in growth – gaining by 69.10%. The bank has an out-of-the-park net interest margin (NIM) rate of 5.00% meaning that it earns a lot more in interest than what it pays for money.
- Surge score: 87/100
- % Above 52-wk low: 157%
- MFI reading: 51
- Sales growth: +57%
- Triple momentum: YES
Reliant is a small-cap bank stock with lots of room to grow.
Share price has tripled from the low set last April, and we now have a beautiful consolidation pattern setting up.
The 10-week period outlined in green shows the volatility compression we often see before a large surge higher.
It is accompanied by declining daily trading volume – a sign of shrinking supply which would further help to propel the stock higher.
The fundamentals look perfect.
Sales and earnings have both grown by 50% or more in each of the last four quarters – all while improving margins.
RBNC also has a history of beating analyst expectations by a wide margin.
A move above $31.00 will get me in this stock.
If that happens, I will work at stop loss at $28.5.
Athene Holding (ATH)
Athene Holding (ATH) is a very aggressive insurance company focused on retirement products – especially in annuities and other longer-term benefit policies. Its focus came from the carnage of the 2007-2008 financial crisis.
It was initially funded and sponsored by a unit of Apollo Global Management (APO) that holds three board seats and owns a big chunk of the shares. It focuses on buying annuity stream obligations and pledged assets at big discounts and locking in its own stream of annuitized revenue from troubled or cash-starved funds and other insurance companies.
This stock continues from last week’s watch list for some very good reasons.
- Surge score: 88/100
- % Above 52-wk low: 116%
- MFI reading: 65
- Sales growth: 80%
- Triple momentum: YES
The chart has continued to consolidate and tighten toward the right side of the chart, so I’m still waiting on this one to trigger long.
Sales are surging by a massive sum – reversing a drop from last year for the recent quarter and 2021 is proving to be a blowout year for company earnings.
The stock has been floating above the 20-day moving average since February and are now forming a textbook consolidation pattern tightening toward the right side of the chart.
The trigger to get long would be a move above $63.60 per share.
My goal is to use a tight stop at $61.50 for a risk of just 3.3% on the trade. Those wanting to give this one a little more room to work could work a stop at $60.00 – just below the consolidation zone.
With each of these trades, I want to see strong volume on the breakout.
A volume surge of several times the daily average and a strong close near the top of the day’s range are ideal for a successful breakout.
And to get more on surging stocks on the Traders Daily Direction watchlist as well as other stocks that I’m following
