With the S&P 500 and the Nasdaq on track to extend their winning streaks to six trading sessions, a mix of stocks were breaking out and hitting new highs in the stock market today . Among them were an IBD 50 member, a blue-chip stock and a regional bank.
[ibd-display-video id=3072810 width=50 float=left autostart=true] PayPal ( PYPL ) moved up 1.7% in early trade to 80.39, before trimming gains to 0.9% in midday trade. Shares broke out past a 79.49 flat-base buy point and were in the 5% buy range that tops out at 83.46.
Early Tuesday, Cowen upgraded the payment processor from market perform to outperform with a price target of 88 - an 11% premium to Monday's closing price.
PayPal - a top stock of 2017 - has five quarters of accelerating earnings growth and two quarters of accelerating revenue growth. In the most recent quarter, year-over-year earnings and sales grew 31% and 21%, respectively.
According to the IBD Stock Checkup , the IBD 50 member has a highest-possible 99 IBD Composite Rating. The rating is a blend of key fundamental and technical metrics designed to gauge a company's leadership potential.
PayPal is a member of the card and payment processing industry, which is ranked No. 44 out of 197 groups .
A potential flaw is the stock's relative strength line - the line painted in blue on every IBD daily and weekly chart. Right now, the line is lagging the share price. Ideally, the line should reach a new high on the breakout day or shortly thereafter, confirming the strength of the breakout.
Johnson & Johnson ( JNJ ) surged 2.7% to an intraday high of 145.68, as the stock held on to the bulk of those gains midday. Shares moved past a 144.45 flat-base entry.
The Dow component has been a steady riser since the stock reached multiyear lows in February 2016, and has an A- Accumulation/Distribution Rating. The strong rating indicates solid institutional demand over the last quarter.
In the latest reported quarter, earnings growth rose 17% vs. the year-ago period. CNBC reported that Johnson & Johnson is likely to benefit from the tax overhaul approved in December.
Financial stocks were on the move higher Tuesday. Regional bank East West Bancorp ( EWBC ) rose past a 64.02 flat-base buy point. Volume was unimpressive, however.
A previous breakout on Nov. 30 above a 62 flat-base entry faltered almost immediately, but never triggered an explicit sell signal, as it eventually found support at the 50-day moving average line. Over the next several weeks, the stock would slowly construct its new flat base.