Become Smarter Investor: Know Why These 5 Stocks Grew Highest Last Week

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As a current (or future) investor in stock markets, you should stay updated on top performers in the market. You should learn not only the names of these companies but also know the underlying reasons why they performed. Inputs like this will help you build knowledge and awareness on performers. By staying updated, you will become smarter day by day.

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Below are the top 5 highest growth companies during the final week of May 2016. The data for the below list is based on the price comparison between May 23 (open price) and May 27 (close price).

1 Dollar Tree, Inc. (DLTR)
May 23 Open Price: $77.11
May 27 Close Price: $88.94
Growth (in %): 15.34%

dollar_tree

Top news/event that inspired the growth:
The 25-year-old retailer saw a whopping 15.34% growth in share prices over last week. The Q1 earnings report quite clearly triggered this spectacular rise. There were several key highlights in Q1. Few of them are as follows.

  1. On a quarterly basis, the sales more than doubled from $2.18 billion to $5.09 billion.
  2. Operating income too nearly doubled from about $200 million to over $400 million.
  3. The EPS of $0.98 was comfortably beating the estimates by almost 100%.

2 Hewlett Packard Enterprise Company (HPE)
May 23 Open Price: $15.88
May 27 Close Price: $18.26
Growth (in %): 14.99%

hp

Top news/event that inspired the growth:
You already know, in the middle of 2015, the original HP split into two business units. HP Inc focuses on PCs, printers, etc., while HPE or HP enterprise caters to commercial needs including servers, IT services, etc. The FY 2016 Q2 results posted by HPE for the quarter ended April 30 have impressed both analysts as well investors. Last week, the overall rise of the HPE share price was as high as 15%. Some key points from the impressive earnings are as follows.

  1. The non-GAAP earnings per share were 42 cents. This EPS figure was following the guidance. Not only the adjusted EPS but the reported (GAAP) EPS was as per the previous estimates.
  2. On a year over year comparison, the cash flow of this quarter almost doubled compared to that in 2015 FY Q2.

Not just the Q2 results, but one another news that lifted the moods of the investors is as follows.

HPE is in the process of a merger with CSC (Computer Sciences Corporation.) This merger will be equal weighted (50:50). The shareholders will hold 50% stake. In total, the benefits for the shareholders will be $8.5 billion. This news brought cheers to the investors of both the companies (HPE and CSC). The optimism was evident from the huge rise in share prices of these two IT giants.

3 Western Digital Corporation (WDC)
May 23 Open Price: $39.50
May 27 Close Price: $44.99
Growth (in %): 13.87%

4

Top news/event that inspired the growth:
You already know that the WDC has acquired SanDisk. On May 26, the company updated its guidance to account for the expectations from SanDisk. Earlier, the company’s estimate for the revenue for the ongoing quarter was in $2.6-$2.7 billion range. Now, the company expects an additional $750 million in revenue. However, the company has lowered its guidance for EPS. Nevertheless, the sentiment seems to be positive due to the expected benefit arising out of the synergies.

Moreover, Barclays has upgraded the rating from “equal weight” to “over weight”. The rise is primarily based on the reduced risk for the company after synergy (with SanDisk).

Therefore, the above two news items, 1) revised guidance and 2) up gradation by Barclays, seem to have instilled optimism.

4 CONSOL Energy Inc. (CNX)
May 23 Open Price: $13.06
May 27 Close Price: $14.85
Growth (in %): 13.71%

CONSOL_ENERGY

Top news/event that inspired the growth:
The oil and natural gas company have shown a rise of about 13.71%. The growth was steady and was not due to a one-off event like quarterly earnings statement. The constant price increase seems to correlate with the steady price rise of oil these days.
Note: You may have to read this post on 60% rise in oil prices in last 5 months if you want to know the reasons behind the crude price rise.

5 Micron Technology (MU)
May 23 Open Price: $10.84
May 27 Close Price: $12.31
Growth (in %): 13.56%

Micron-Technology

Top news/event that inspired the growth:
MU stocks surged by over 13% in last week. There could be multiple reasons for the steady increase in prices. Few of them follow:
As pointed out in our last week’s post the results of Applied Material had a positive spillover effect on Micron as well. Moreover, there has been positive news for memory chip makers in the recent days. Over past few years demand NAND devices (like SSDs, which are alternative to traditional Hard Disk Drives) was sluggish. But now the situation is changing, due to performance and storage advantages of NAND devices as well as their lowering costs. You got to know that MU is steadily ramping up its NAND production.

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