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Trade of the Day: Prudential Financial Inc (PRU) Stands Above Friday’s Turmoil

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Prudential Financial Inc (NYSE: PRU ) - This large-cap financial services company provides insurance, investment management and other financial products to clients in the U.S. as well as globally.

Various ongoing international expansion programs should add long-term revenues, such as PRU's new expansion in Japan. Their varied product offerings, geographic diversification and well-known and accepted brand name all contribute to high public recognition.

In 2016, Standard & Poor's estimates that earnings will at about $8.66, down from $12.17 in 2015. However the 2015 result was unusually strong vs. $3.20 in 2014. Their operating earnings estimate for 2017 is $10.15 per share, thus S&P estimates that the stock is undervalued vs. peers and its 10-year average of 9.7X earnings.

S&P's 12-month target is $82, which would assume it trades at just 8.1X 2017's estimated EPS. PRU pays an annual dividend of $2.80, providing a yield of 3.5%.

When the stock market sustains a sharp loss, such as Friday's, when just 173 stocks advanced and 2,953 declined, it is always a good idea to highlight those that resisted the selling and instead advanced.

PRU stock closed higher against a harsh environment and rose 49 cents on much-higher-than-average volume. On August 25, PRU buyers emerged to break through the bearish resistance line at about $77, and that breakout was quickly followed by a CBR Super Buy from my own internal indicator.

Last Tuesday the 50-day moving average crossed through the 200-day moving average, signaling a "Golden Cross" long-term trend change and buy signal.

Technically PRU is in a new bull market, and so try to buy it at $78 with a trading target of $90 for an objective of 15%-plus.

Investors may also consider this quality financial services company as a long-term income producer and growth investment.

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The Nasdaq and Tech Stocks Quietly Lead

The Nasdaq was almost unheralded as it broke to a new closing high at 5,531.82. The junior index has jumped almost 30% from its February low, and yet on Monday most investors were focused on the Dow and its attempt to overcome the 20,000 line.

The post Trade of the Day: Prudential Financial Inc (PRU) Stands Above Friday's Turmoil appeared first on InvestorPlace .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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