Ouch! The market sold off in heavy fashion, thanks in part to some economic news that threatens the already fragile economy. First-time jobless claims rose the highest level since November 2009. The Philly Fed Reserve's monthly survey of economic activity fell by over 7.5%, it's lowest level in more than a year. This came after rising 5% in July.
Even with such a sour economic environment, I'm keeping a watch list of stocks I'd like to purchase when things look a little better. One of the stocks I'm looking at is Chipotle Mexican Grill (CMG). I like this for a number of reasons. First, they always have customers lined up out the door. They're incredibly popular because they offer fresh fixings with what they call "ethically sourced" meat and vegetables. They're also a "green" company. Their eateries are designed in an eco-friendly manner. From a fundamental picture, they look pretty strong. They have rising earnings, and they are planning expansions throughout the country. The majority of their stores are in the West and South, but look for more stores to open in the Northeastern part of the U.S. To date, they've launced 1,000 eateries nationwide. They recently opened a unit in London and the word is that they will be opening eateries in France and Canada in the coming year.
Today's closing price is $147.92 and I don't think this is a bad entry point. A pullback to the 50-day (around $144 range) could also give you a good starting point in which to build a stake.
Keep an eye on it. Comments welcome.
Happy Trading!
Obligatory disclaimer: This blog is for information only. Past results do not guarantee future performance. All financial decisions involve risk and there are no guarantees. The suggestions above are simply suggestions and the blogger is not liable for any losses incurred as a result of actual investment activity on the part of the reader.
Thursday, August 19, 2010
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