Three recommendations today: A Buy on a building products company trading at a discount, with lots of upward momentum, and profit-taking on two previous ideas.
Buy: Huttig Building Products (HBP)
From Top Stocks under $10
Huttig Building Products (HBP), which produces stairs, doors, lights, decks, siding and other specialty products across a large swath of the U.S.
Additionally, the company:
· Trades at 5.5 times forward earnings and experienced consistent revenue growth.
· Produced positive earnings growth over the last five-quarters and has positive trailing 12-month free cash flow.
· Earns 15.6% return on invested capital.
The positive fundamental condition and improvement in U.S. housing market conditions should continue to drive HBP shares higher.
Huttig Building Products registered a breakout in June to a nine-year high. Huttig’s breakout has now fueled a new surge higher. We’re now keeping our eye on the June 2007 high of $8.77.
Even more encouraging is that the breakout came on heavy trading volume. That tells us that investors are committed to pushing the shares higher.
We are monitoring these shares closely after falling on light volume and no significant company news in recent sessions. The shares are volatile and are holding at support. We expect HBP to resume the charge higher as investors recognize the opportunity.
Mandeep Rai, Top Stocks under $10, published by Money and Markets, a Division of Weiss Research, Inc., www.moneyandmarkets.com/services/trading-services/top- stocks-under- 10, issues@e.moneyandmarkets.com; 1-800-291-8545, July 7 & July 20, 2016