The market continues to move higher, fueled by tax reform that once again pushed The Dow Jones to a new record high. Investors have enjoyed strong gains since President Trump's unexpected victory last year, and the Republican's ability to come together on tax reform should push shares higher moving forward. Companies are already earning a lot of money, so lower taxes will allow them to return more money to shareholders through higher dividends and greater share buybacks, so the market is reacting positively to the tax reform plan and pushing shares into record territory once again. With the markets near record highs, a lot of individual stocks have always enjoyed big breakout years. In some cases, these stocks appear to have traded up into overbought territory, but there are still plenty of high-flying stocks that have the potential to build on recent gains and continue trending higher. If you have some extra cash you are looking to invest before the end of the year, consider these five stocks, as it appears as if nothing can stop their upward momentum.
Apple
Tech titan Apple (AAPL) has is headed into the holiday season at record levels. The company has battled concerns over a lack of creativity since the passing of its founder, Steve Jobs, but there is no denying how rabid the company's fans remain for its products. The iPhone remains the most popular smartphone on the market, and Apple's newest iPhone models have been very well received and should provide a nice boost for the stock into the new year. AAPL has an attractive valuation, with a P/E of 19.4, and with analysts expecting earnigns growth of 10.7% per annum over the next five years, the stock should build on recent gains and continue to hit new highs. Apple is a true darling of Wall Street, and remains a very attractive buy candidate.
Chart courtesy of www.stockcharts.com
Visa
The recent earnings season proved that consumers remain upbeat and are spending, but there is definitely a clear movement towards online shopping. E-commerce continues to gain in percentage of overall retail sales, and that is a good sign for payment processors such as Visa (V). Visa has done a great job growing earnings in recent years, and analysts expect to see the payment processor grow profits on average by 16.6% over the next five years. The stock has a high valuation, with a P/E of 40, but the strong growth estimates should be enough to keep Wall Street in the stock. V is now trading at $107.61, and analysts have an average price target of $124.74 on the stock.
Chart courtesy of www.stockcharts.com
Caterpillar
Heavy machinery maker Caterpillar (CAT) has been a top stock over the last two years, fueled by improvements in commodities, and overall strength in the U.S. economy. President Trump plans to boost federal spending on infrastructure and still intends to move forward on his plan to build a wall on the Mexican border, which would help keep demand strong for CAT's products. CAT has a high valuation, but analysts expect the company will grow earnings by 39.6% per annum over the next five years which should keep Wall Street into the stock and shares moving higher. The company last reported earnings at the end of October, with results well above estimates on both the top and bottom line, the third straight quarter it has topped both earnings and revenue estimates. Optimism remains upbeat, and shares should continue moving higher due to the strong growth the company is experiencing.
Chart courtesy of www.stockcharts.com
Amazon
E-commerce leader Amazon.com (AMZN) has been a top performer for years, and with strong growth forecasts the company should continue to enjoy stock gains. The current holiday season is off to a strong start, and online sales have been very impressive. Not only is Amazon a leader in e-commerce, but it has also emerged as a leader in cloud computing, which is one of the fastest growing sectors in tech. Analysts see earnings rising by 85.6% in 2018, and over the next five years by 33.5% per annum. Wall Street loves the stock, and has an average price target of $1,264.52 on the stock, versus its current $1,145.90 price.
Chart courtesy of www.stockcharts.com
BB&T Corp.
Regional bank BB&T (BBT) is currently trading just shy of its record high, and the outlook remains very favorable. After years of near-zero interest rates, the Federal Reserve has started to allow rates to rise, which is a very good thing for the financial sector. Banks like BB&T generate a lot of the income from interest they generate on loans, and rising rates allow them to widen the spread between money they loan out versus money they borrow. As such, the market has been very bullish on the sector, and should remain so moving forward. BBT has a P/E of 18.9, and analysts see earnings growth of 23.4% in 2018.
Chart courtesy of www.stockcharts.com