Look in the fridge for your next investment

I'm adding an old favorite brand name to my Wall Street Survivor portfolio: Arm & Hammer. Like me, you might not know the name Church & Dwight.

By Jim Van Meerten Feb 24, 2010 1:25PM
Last week I sold ScanSource (SCSC) and needed a replacement. When I'm on the hunt I first go to Barchart and screen for the stocks having the most frequent price appreciations in the last 20 sessions; take the top 10 and then do some additional screening to see what should be eliminated. The stock I had left was Church & Dwight Company Inc (CHD). The name didn't ring a bell with me and I was surprised to find that was the name of holding company that owns Arm & Hammer; products I've been using for years.

First let's see why it came up on my list. The stock had a price appreciation in 14 of the last 20 trading sessions and was 5 for 5 recently. It has enjoyed a 7.97% price increase in the last month. On Barchart's 13 technical indicators the stock has a buy signal on 12 of the 13 indicators. This stock has the positive and consistent price momentum I like.

On the fundamental side analysts have 5 buy, 9 hold and only 1 under perform recommendation outstanding and 10 of them have increased their EPS estimates for the future in the last 30 days alone. They expect a 4.1% increase in revenue coupled with a 11.3% increase in earnings per share for the coming year. A 5 year compounded EPS growth rate of 12% is projected.

The stock enjoys growing investor sentiment. Some of that might have been triggered by a recent article on The Street.com naming CHD as one of the top 5 Mid Cap Stocks. On Motley Fool CAPS members have noticed and voted that the stock will out perform the market by a vote of 303 to 15 and the All Stars agree 111 to 6. The Wall Street columnists Fool follows like the stock 8 to 0.

The reasons I like CHD:
  • Recent price appreciation in more than 50% of the last 20 trading sessions
  • Good analysts recommendations with positive revenue and earnings projected in the future
  • A solid brand recognition on the products it owns
  • Positive recent press on The Street.com
  • Great investor sentiment as evidenced by the positive votes from Motley Fool members.

I'm adding 150 shares of Church & Dwight (CHD) to my Wall Street Survivor portfolio to replace ScanSource (SCSC) which I sold last week when it failed to maintain a price above its 50 day moving average.

 

Jim Van Meertren is an investor who writes on financial matters here and on Financial Tides. Please leave a comment below or email JimVanMeerten@gmail.com

 

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Disclosure: No positions in the stocks mentioned at the time of publication

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