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Examining 3 stocks that have historically outperformed in April
About a month ago, using data supplied by Schaeffer's Senior Quantitative Analyst Rocky White, I examined three stocks with the potential to rally in March. As we approach April, I decided to repeat this exercise, and identified a trio of names to keep an eye on during the upcoming month: Boeing Co (NYSE:BA), Deere & Company (NYSE:DE), and Corning Incorporated (NYSE:GLW).
Below, you'll find a list of 53 stocks with positive returns at least 90% of the time over the past 10 years, during the month of April. Once again, the data comes courtesy of White. Below the list, you'll also find some commentary on the three aforementioned names -- BA, DE, and GLW -- and why they could be poised for another outsized move in April.
Boeing Co (NYSE:BA)
BA has been a technical beast in 2015, sporting a year-to-date lead of 17.1% to trade at $152.19 -- a move noticed by Jefferies, which overnight upped its price target on the security to $185 from $165. What's more, the financial stock has outperformed the broader S&P 500 Index (SPX) by 15.2 percentage points over the past three months. Honing in on the month of April, over the course of the past 10 years, BA has advanced nine times, with an average return of 6%.
Nevertheless, negativity abounds in BA's options pits. The equity's 50-day put/call volume ratio across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) is 0.74, which sits just 8 percentage points from a 12-month peak. In other words, traders have bought to open BA puts over calls at a faster-than-usual clip lately. Echoing this, the stock's Schaeffer's put/call open interest ratio (SOIR) of 1.51 rests higher than 83% of comparable readings from the past year. A capitulation among bearish options bettors could result in upside for the underlying.
Deere & Company (NYSE:DE)
DE has been rallying over the past several months. Since hitting a two-year low of $78.88 in early October, the shares have tacked on 12.3% to trade at $88.60. Looking further back, the farming equipment stock has been positive in nine of the past 10 Aprils, averaging a single-month gain of 4.5%. In fact, DE's lone monthly decline was all the way back in 2005, meaning the equity has been positive in each of the previous nine Aprils.
Nevertheless, the brokerage bunch is skeptical of DE. Thirteen of 17 analysts tracking the shares rate them a "hold" or worse. On top of that, the stock's average 12-month price target of $86.37 stands at a discount to the current price. This leaves the door wide open for a potential round of upgrades and/or price-target hikes.
Elsewhere, 9.5% of DE's float is sold short, which would take nearly nine sessions to repurchase, at typical daily trading levels. In other words, the security could be on the verge of a short-covering rally.
Corning Incorporated (NYSE:GLW)
GLW has displayed long-term technical tenacity. Year-over-year, shares of the tech firm sport a lead of more than 17% to hover near $23.53. With respect to April, the stock has advanced in nine of the last 10 years, with an average gain of roughly 6%.
Despite GLW's strong track record, there's plenty of pessimism on the Street. For one, the security's 10-day ISE/CBOE/PHLX put/call volume ratio of 1.38 outranks 93% of comparable readings from the last year. For another, nine of 13 covering analysts rate the stock a "hold" or worse. Suffice it to say, an unwinding of this negativity could pave the way for additional gains.