Best Stocks To Buy And Watch Now: 5 Top Stocks For March

Buying a stock is easy, but buying the right stock without a time-tested strategy is incredibly hard. So what are the best stocks to buy now or put on a watchlist? Apple (AAPL), Google parent Tesla (TSLA), Raytheon Technologies (RTX), Shell (SHEL) and LPL Financial (LPLA) are prime candidates.

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With inflation worries growing, and the Federal Reserve taking a more hawkish approach to interest rates and bond purchase tapering, market action has been challenging so far in 2022. The Russian invasion of Ukraine continues to weigh on markets. The current market rally is coming under renewed pressure.

Best Stocks To Buy: The Crucial Ingredients

Remember, there are thousands of stocks trading on the NYSE and Nasdaq. But you want to find the very best stocks right now to generate massive gains.

The CAN SLIM system offers clear guidelines on what you should be looking for. Invest in stocks with recent quarterly and annual earnings growth of at least 25%. Look for companies that have new, game-changing products and services. Also consider not-yet-profitable companies, often recent IPOs, that are generating tremendous revenue growth.

IBD’s CAN SLIM Investing System has a proven track record of significantly outperforming the S&P 500. Outdoing this industry benchmark is key to generating exceptional returns over the long term.

In addition, keep an eye on supply and demand for the stock itself, focus on leading stocks in top industry groups, and aim for stocks with strong institutional support.

Once you have found a stock that fits the criteria, it is then time to turn to stock charts to plot a good entry point. You should wait for a stock to form a base, and then buy once it reaches a buy point, ideally in heavy volume. In many cases, a stock reaches a proper buy point when it breaks above the original high on the left side of the base. More information on what a base is, and how charts can be used to win big on the stock market, can be found here.

Don’t Forget The M When Buying Stocks

A key part of the CAN SLIM formula is the M, which stands for market. Most stocks, even the very best, follow the market direction. Invest when the stock market is in a confirmed uptrend and move to cash when the stock market goes into a correction.

A stock market rally that kicked off 2022 soon fell on its face. The market is trying to rally again but has been struggling to make decisive progress. The Nasdaq has fallen back below the 50-day moving average while the S&P 500 is trying to cling onto its 200-day line. The Dow Jones Industrial Average has been testing its 50-day line.

The current uptrend is now under pressure, which means it is time to adopt a defensive posture. It is a bad time to making new buys, aside from exceptional breakouts in exceptional stocks. This is a bad time to be adding shares to existing holdings and it is a good time to get off margin, too. This is an ideal time to add names to one’s watchlist though, with the names below being good candidates.

Remember, there is still significant headline risk going forward. Inflation remains a key issue while the Russia-Ukraine conflict is a wild card that has proved its ability to shake the market.

But remember, things can quickly change when it comes to the stock market. Make sure you keep a close eye on the market trend page here.

Best Stocks To Buy Or Watch

• Apple
• Tesla
• Raytheon
• Shell
• LPL Financial

Now let’s look at Apple stock, Tesla stock, Raytheon stock, Shell stock and LPL Financial stock in more detail. An important consideration is that these stocks all boast impressive relative strength.

Apple Stock

AAPL stock is trading below a double-bottom pattern entry. The ideal buy point here is 176.75, according to MarketSmith analysis. It has also formed a new handle, which offers a higher 179.71 buy point. That may be the more relevant entry now.

Apple stock recently reclaimed its 50-day line after rebounding from its 200-day moving average. The relative strength line has just hit a new high. A protracted upwards spike could propel AAPL higher once again.

A key point in the favor of Apple stock is the fact it performed better than most stocks, especially techs, during the market pullback.

Apple has seen its Composite Rating shoot up to a strong 95 out of 99. Apple became the first company to reach a market capitalization of $3 trillion earlier this year, though it has now backed off this level.

The IBD Stock Checkup tool shows earnings growth is bouncing back in recent quarters following the Covid-19 pandemic. Apple stock got a boost after reporting earnings for Q1 of fiscal 2022.

It was the firm’s best-ever quarter for revenue, with all categories excluding iPads coming in above views. Apple did not give guidance for the current quarter, though executives were relatively upbeat. The firm has not given specific quarterly guidance since the Covid-19 pandemic began.

Supply constraints meant supply could not keep up with demand. Another bright spot was sales in China, which grew 21% in the quarter.

Apple‘s EPS growth has averaged 65% over the past three quarters. This is comfortably clear of the 25% earnings growth sought by the CAN SLIM cognoscenti.

Analysts see earnings growth of 10% in fiscal 2022 and 7% growth in 2023. Investors will want to see CEO Tim Cook squeeze out more impressive gains.

With its iPhone business maturing, investors are looking for a new big growth driver for Apple stock. Services and wearables are seen as two key drivers.

In the September quarter, Apple’s services revenue rose 26% year over year to $18.3 billion. Services include the App Store, AppleCare, iCloud, Apple Pay, Apple Music, Apple TV+, Apple Arcade and other offerings.

One reason to be bullish on Apple is it continues to produce new products, which is a major success factor in the CAN SLIM system.

Earlier this month Apple hosted its latest product launch. The event, broadcast live online from Apple Park headquarters in Cupertino, California, saw a slew of products unveiled.

Perhaps most notable was a new low-cost 5G iPhone SE. It will retail for $429 and will hit store shelves on March 18.

Speculation continues that Apple is looking to make a self-driving electric car.  In November Bloomberg reported Apple is aiming to launch self-driving EVs in 2025.

Looking For The Next Big Stock Market Winners? Start With These 3 Steps

Tesla Stock

Tesla stock has a cup-base buy point of 1,208.10, according to MarketSmith analysis. On a weekly chart, TSLA stock has a handle, offering a new, lower 1,152.97 buy point. Investors may welcome a slightly deeper, longer handle, to shake out weak holders and let key moving averages catch up.

However Tesla’s relative strength line has backed off a bit after spiking at the start of last week.

A mixture of top class stock market performance and improving earnings have netted TSLA a near-perfect IBD Composite Rating of 97.

The stock checkup tool underlines the improving financial performance. Earnings have grown by an average of 197% over the past three quarters, well clear of CAN SLIM requirements. Longer term results are also impressive, with its three-year EPS growth rate coming in at 211%.

Tesla stock got a boost last week after it opened its new factor in Austin, Texas. The $1.1 billion facility was unveiled at a glittering Cyber Rodeo event, where CEO Elon Musk boasted about its size.

“Giga Texas is the largest factory building in the world by volume,” Musk said. He joked the firm had calculated “you could fit a 194 billion hamsters in this building.”

The firm delivered a handful of Model Ys at its factory launch. Giga Austin Model Ys will be the first to feature Tesla’s new structural battery pack and 4680 battery cells.

It’s unclear if all Model Ys produced in Austin will include the new battery packs. They are not yet being mass produced, so key cost savings haven’t been achieved.

Musk spoke for less than 30 minutes at Thursday’s event, before several Model Ys were driven across the stage. Tesla’s Cybertruck made an appearance afterwards, with Musk pointing out a new feature: It has no handles, as it is purportedly able to automatically sense when the driver is nearby. Musk said Tesla plans to begin production of the Cybertruck next year.

“This year is all about scaling up, and next year there is going to be a massive wave of new products,” he said. Musk also touted the Roadster and Semi for next year.

Meanwhile the firm has been affected by rising Covid cases in China. The Tesla Shanghai factory has been shut down since March 28 due to strict government rules.

Tesla Shanghai is in the midst of its longest stoppage since it started production there in 2019. The plant produces more than 2,000 vehicles per day.

Raytheon Technologies Stock

The stock is close to breaking out from a flat base with a 104.44 buy point. The stock is also arguably actionable from a rebound off its 10-week line.

Given current market conditions, investors looking for an early entry might be better off waiting for RTX stock to clear its March 25 high of 125.97. It hit resistance just shy of that key level at the end of last week.

The relative strength line has been taking a breather following a recent spike. The current global security situation means another spike would be no great surprise.

At the moment Raytheon stock holds a less than optimal IBD Composite Rating of 84 out of 99.

Earnings are something of an Achilles heel, with its EPS Rating coming in at 71.

However this appears to be on the upswing, with earnings growing by an average of 112% over the past three quarters.

This is a significant improvement on its longer term performance. Over the past three years EPS has shrunk by 25%.

Raytheon makes missile defense systems, aircraft engines and communications technology. Russia’s invasion of Ukraine has sent defense stocks higher, on anticipation of more demand for artillery as the conflict continues.

These Stocks Are Healthy As Market Rally Ails

Shell Stock

Shell stock is near a 56.23 buy point after rebounding from its 21-day line. It has built a bullish base-on-base formation due to firm support at the 50-day line. SHEL stock edged higher last week, flirting with breakout on Friday before backing off.

The stock has bounded away from its 10-week line of late. And while the RS line has been choppy in recent weeks it is still in the midst of a general uptrend since the start of the year.

Stock market performance is a key strength for Shell stock. It is the top 5% of stocks in terms of price performance over the last 12 months, with shares popping nearly 40% during that period.

Earnings are also solid, though its EPS Rating of 77 out of 99 is nowhere near as impressive. Nevertheless, analysts expect the company’s earnings to jump this year. They see EPS surging 61% to $8.04. They also see sales jumping 40% to $365.5 billion.

The recent IBD Stock Of The Day  has been attracting investment from Big Money of late. This is reflected in its Accumulation/Distribution Rating of A-. It also boasts a low P-E rating of 11, which is about half that of the broader S&P 500.

SHEL stock is gaining after Russia’s invasion of Ukraine drove energy costs higher and, after some early missteps, Shell joined other energy leaders in exiting all of its operations in Russia.

But questions remain about the impact from China’s recent Covid lockdowns, efforts to lower gas prices and whether those efforts can effectively provide any relief for consumers.

Oil prices tumbled 13% last week to $99.76 per barrel, as the U.S. led many nations in releasing emergency oil reserves

Shell executives are among of a group of six big oil names set to testify before a House hearing this coming week, looking into allegedly disproportionate increases in gasoline prices.

LPL Financial Stock

LPL Financial is currently sitting pretty above a cup-with-handle buy point of 191.08. Its 5% buy range extends to 200.63.

This is a first-stage base, which means it has a higher chance of success.

The relative strength line added credibility to the breakout by shooting to new highs as it passed its buy point. It is also sitting comfortably clear of the 21-day exponential moving average

Earnings are a strength for LPLA stock, but price performance is even better. Earnings have grown by an average of 20% over the past three quarters.

Analysts see earnings growing by 35% in 2022 and 50% in 2023.

Big money has also been a net buyer, with 65% of the stock currently being held by funds.

Recent bullish action has won LPL Financial stock a place on the prestigious IBD Leaderboard list of top stocks.

The recent IBD Stock Of The Day has a network of nearly 20,000 financial advisors nationwide. It added an impressive 2,589 advisors in 2021, including 900 from its Waddell & Reed acquisition.

In 2021, LPL’s assets swelled to a record $1.2 trillion, jumping 34% year over year. The company benefited from a soaring stock market and better recruiting. It also gained from its Waddell & Reed Wealth Management purchase.

Amid the pandemic and stimulus surge in savings for many Americans, a 2021 Harris Poll survey found 26% of Americans said their most trusted source for financial advice is a financial advisor. That was up from 22% a year earlier. In 2020, 30% of respondents said their most trusted source for financial advice was themselves. That number dropped to 20% in 2021.

The San Diego-based broker-dealer currently holds pole position in the Finance-Investment Banks and Brokers group. It also features the likes of Charles Schwab (SCHW) and Raymond James (RJF).

Please follow Michael Larkin on Twitter at @IBD_MLarkin for more on growth stocks and analysis.

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