“Molex, Inc. (MOLX) manufactures and sells electronic components like micro-miniature connectors, SIM card sockets, keypads, electromechanical subassemblies and internal antennas and subsystems for the telecommunications market. Molex also designs and manufactures connectors for home and portable audio, digital still and video cameras. From a top down perspective this is the best company in this month’s report.
“Sales growth over the past few years has been consistent, operating margins are stable and the balance sheet is clean. Additionally, Molex generates over $250 million in cash from operations every year. And the chart confirms what we already know from the financials—this is a solid stock. After breaking out from a cup and handle pattern last November, shares ran 40% to $28 before consolidating in February. But after three months of consolidation, shares look ready for another move higher. At this time it appears unlikely MOLX has the valuation for another 40% rally, but a break out past $28 would result in a sharp move towards $34. The stop loss can be placed at $25, or $26.25 if you wait to buy on a move past $28. This is a great stock in a growing industry. Price Target – $34, Stop Loss – $25, Market cap – $4.5 billion, Support – $26, $24.50, Resistance – $27, $28.25.”
Jason Cimpl, TradeMaster Daily Stock Alerts, 5/31/11
