Author: Raj Gupta

Raj Gupta is Director, Research Analyst. After joining the firm in 2002 as a research analyst, Raj was appointed senior equity analyst in 2006, and lead senior equity analyst in 2014—largely because of his ability to select outperforming stocks. He acts as an expert in the O’Neil Methodology and contributes to the direction of product and service line development. He recommends securities for addition to or removal from the U.S. Focus List, or USFL, and the associated alerts to clients. During his tenure, he was part of the leadership that developed the Global Focus List, which marked the firm’s successful expansion into international equity recommendations. He is also a lead on the IPO Rewind report and contributes to weekly summaries on the performance of the U.S. market. Much of his expertise is delivered as highly customized service to clients. RAj earned his Bachelor’s degree in Economics from the University of California, Santa Barbara. He began working at the firm directly out of college, driven by his passion for investing and stocks. An avid soccer player, he built and managed an adult league in the Los Angeles area, in which he still plays. He also enjoys international travel; he and his wife commit to at least one major adventure a year.

Market View

Posted on December 9, 2017October 17, 2019 by Raj Gupta

Market Overview
The U.S. market remains in a Confirmed Uptrend. The Nasdaq held its 50-DMA this week, while the S&P 500 remained at all-time highs. Distribution stands at five days on the S&P 500 and four on the Nasdaq with expira-tion beginning next week. Multiple sectors, including Financial, Retail, and Transportation, continue to act well, all trading at all-time highs. Technology did find support over the last three sessions, but the majority of ideas are still forming new bases. We continue to recommend a patient approach to Technology until we see more ideal entry points in individual ideas.
Stocks on our U.S. Focus List—Current Sentiment
Our USFL of 71 ideas (one net removal) was flat this week, in-line with the S&P 500 (+0.3%) and the Nasdaq (0%).

By Sector
Retail ideas on the U.S. Focus List remain under accumulation. FIVE, WING, and HD remain at new highs, while OLLI is actionable after it pulled back to its pivot post-earnings. Consumer Staple ideas also continue to act well with BUFF, EL, and MNST remaining at all-time highs. Technology ideas did bounce, but most are not actiona-ble yet. AVGO, FB, and RNG are all above their 50-DMAs and actionable at current levels.

Market View

Posted on December 1, 2017October 17, 2019 by Raj Gupta

Market Overview
The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq continue to diverge with Technol-ogy coming under severe selling pressure this week. Multiple leading ideas in the sector have now broken short-term support levels and will likely go through a period of consolidation before a recovery takes place. Though weakness in Technology persisted through the end of the week, Consumer Cyclical, Financial, Transportation, and Retail are still trading at or near new highs as rotation into value continues. A further rise in distribution that takes the major averages below their respective 50-DMAs will result in a downgrade of the U.S. market.
Stocks on our U.S. Focus List—Current Sentiment

Our USFL of 72 ideas (two net removals) lost 2.2% on average this week, underperforming the S&P 500 (+1.5%) and the Nasdaq (-0.6%).

By Sector
Technology ideas on the U.S Focus List are pulling back to price and moving average support. Semiconductors, in particular, took the brunt of the selling. AMAT, CY, MCHP, MPWR, NVDA, and SWKS all broke their respective 50-DMAs. Software ideas also sold off with ATVI, NOW, PAYC, and QTWO all breaking their 50-DMAs. Finan-cial ideas on our Focus List came under accumulation. ESNT, MS, SCHW, SIVB, VNTV, and WAL are all now trading at all-time highs. Building-related ideas across multiple sectors are also acting well. EXP, HD, and PHM are hitting new highs.

Market View

Posted on November 24, 2017October 17, 2019 by Raj Gupta

Market Overview
The U.S. market is in a Confirmed Uptrend. The major averages continue to push into new highs with healthy action across leading ideas. Distribution stands at five days on both the S&P 500 and Nasdaq, with multiple days set to expire next week. We maintain our positive view on the general market.
Stocks on our U.S. Focus List—Current Sentiment

By Sector
Technology ideas on the U.S Focus List continue to outperform. Ten Technology ideas, including EXTR, GRUB, OLED, MB, PAYC, and CY, gained more than 3% week-over-week. Retail ideas were also under accumulation with AMZN, BABA, HD, and OLLI all moving back into new highs. Though all sectors moved higher, Financial ideas on our Focus List traded mostly sideways. MS, SIVB, and WAL are all consolidating constructively, while FRC remains under pressure.
New Ideas or Deletions

Market View

Posted on November 17, 2017November 23, 2017 by Raj Gupta

The U.S. market is in a Confirmed Uptrend. Indices, led by the Nasdaq, rallied back into all-timehighs. Alt-hough the distribution day count increased to six on the Nasdaq and fiveon the S&P, price action across leader-ship ideas remains constructive. We will become more cautiousif distribution remains elevated as indi-ces/leading stocks fall below key support levels.

Stocks on our U.S. Focus List—Current SentimentOur USFL of 73 ideas (no net change)gained 1.6% on averagethis week, outperforming the S&P 500(-0.1%) and the Nasdaq (0.5%).

By Sector

Technology ideas on the U.S Focus List continue to outperform. EXTRand WBrose over 10% after reporting good results last week. EXTRis buyable. ALRMregained its 100-DMA on strong volume but remains below its 50-DMA and is poised to consolidate. Consumer Staple outperformed, led by heavy accumulation in BUFFand MNST. Within Financial, payment processors including PYPLcontinue totrend higher.

Market View

Posted on November 10, 2017November 22, 2017 by Raj Gupta

The U.S. market is in a Confirmed Uptrend. Though distribution rose this week to two and five days on the S&P 500 and Nasdaq, respectively, each index continues to hold short-term support at the 21-DMA. Leadership also remains healthy with 80% of the U.S. Focus List still trading above the 50-DMA and 60% within 5% of a new high. We will become more cautious should we see a further rise in distribution that takes the major averages below their respective 21-DMAs. Stocks on our U.S. Focus List—Current Sentiment Our USFL of 73 ideas (two net additions) was flat this week, outperforming the S&P 500 (-0.2%) and the Nasdaq (-0.2%). By Sector Despite the pullback in Technology this week, most Technology ideas on the U.S. Focus List responded well to earnings. WB, OLED, TTWO, CY, RNG, and NVDA all moved into new highs. Conversely, ALRM, TYL, and ZAYO broke their respective 50-DMAs. Outside of Technology, MNST and PLNT both moved into new highs post earnings. Health Care continues to be under pressure. PRAH broke its 50-DMA following poor earnings results from peers. VRTX also continues to live below its 50-DMA due to a weakening biotech industry group. Only 8% of our U.S. Focus List is made up of Health Care ideas after multiple ideas have been removed the last few weeks.

Global Health Care Sector

Posted on November 8, 2017November 8, 2017 by Raj Gupta

U.S. Health Care Sector
The Health Care Sector has slowed on a relative basis over the past two months and is now declining on an absolute basis over the last three weeks. The sector is now trading below its 50- and 100-DMAs, largely due to a recent sell-off in the Biotech and Ethical Drug industry groups, which make up the bulk of the sector. We are now looking for the lower channel line to hold before support along the 200-DMA. Though we have become cautious on the Biotechs due to multiple bellwethers breaking individual technical support levels, other industry groups within Health Care remain healthy, including Products, Equipment, and Managed Care. Also, long-term lagging industry groups (Hospitals and Wholesalers) remain weak and should continue to be avoided. Currently, S&P 500 Health Care companies are trading exactly in-line with the S&P 500. Both are trading at a median of 18x 2018 EPS with consensus 2018 median EPS growth of 10% y/y.

Market View

Posted on November 3, 2017November 22, 2017 by Raj Gupta

Market Overview
The U.S. market is in a Confirmed Uptrend. Indices tacked on small gains this week and continue to trend high-er along their 21-DMAs as distribution remains low. Earnings season has been strong for the USFL with the ma-jority of ideas reporting better-than-expected results. We remain positive on the general market as we head into the final weeks of earnings season.
Stocks on our U.S. Focus List—Current Sentiment
Our USFL of 71 ideas (no net change) gained 0.9% on average this week, outperforming the S&P 500 (0.2%) and relatively in-line with the Nasdaq (0.9%).

By Sector
Earnings season continues to very good for USFL stocks, with many gapping up on better-than-expected results. Under the radar, TNET, gapped-up +15% after reporting an EPS surprise of over 124%. OLED, WING, and sur-prisingly EL jumped higher after exceeding expectations. Although FB and BABA pulled back slightly, both re-main buyable after reporting outstanding quarterly results. ADBE gapped up three weeks ago and continues to hit new highs, while TEAM is trading in a tight range and poised to follow in a similar fashion.

Market View

Posted on October 27, 2017November 3, 2017 by Raj Gupta

Market Overview
The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq moved back into new highs Friday after finding support around their respective 21-DMAs. Distribution days remain low with one on the S&P 500 and three on the Nasdaq. Leadership also remains strong with the majority of ideas continuing into new highs post earnings results. We remain positive on the general market.
Stocks on our U.S. Focus List—Current Sentiment
Our USFL of 71 ideas (two net additions) gained 0.9% on average this week, outperforming the S&P 500 (0.2%) and in-line with the Nasdaq (1.1%).

By Sector
Strength across the USFL came primarily from Technology for a second straight week. GOOGL, GRUB, and LOGM all broke out post earnings. MPWR and CY also moved into all-time highs following earnings. Converse-ly, Health Care came under heavy pressure due to Biotechs selling off after their respective earnings results. ALXN and BIVV both reported numbers ahead of consensus, but still sold off below their respective 50-DMAs. VRTX also put in a big beat-and-raise quarter, but also sold off before recovering on Friday. On the opposite

Market View

Posted on October 20, 2017October 17, 2019 by Raj Gupta

The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq continue to show resilient action, staging upside reversals on Thursday and continuing into all-time highs to close the week. The Nasdaq did pick up one distribution day, but the count still remains very low at just one day on the S&P 500 and two on the Nasdaq. Leadership has been very strong, with multiple U.S. Focus List ideas gapping up into all-time highs after earnings. We remain positive on the general market.

Stocks on our U.S. Focus List—Current Sentiment

By Sector
Strength across the USFL came primarily from Technology and Financial. Software led with major gap ups in ADBE and TEAM this week. ADSK, RHT, CRM, NOW, PAYC, and SSNC all hit new highs. Financial was led by ESNT, which has rallied for nine straight sessions. Payment Processors and Banks were also under accumulation. MS remains at a pivot, but becomes extended above $51. PYPL gapped into an all-time high after earnings.
New Ideas or Deletions
We added Zayo Group and removed Celgene from the U.S. Focus List this week.

IPO Rewind

Posted on October 20, 2017March 27, 2019 by Raj Gupta