In economic news today, pending home sales rose 4.3% in August. This is the second monthly increase in pending sales, but it's still down from where it was one year ago. Factory orders fell more than expected. They fell .5% in August vs. an increase of .5% in July. The Commerce Dept. claims that's because of a drop in demand for transportation equipment.
The dollar also rebounded today and this led to some profit taking in certain sectors (i.e. . materials). This also impacted energy prices. Crude fell to approximately $81/bbl and even gold slipped a bit just below $1315/ounce.
There were some interesting stocks in the news today. Church and Dwight (CHD) shot up just over 3% today. Who knew soap could be so profitable? Solar stocks took a hit today. First Solar and LDK Solar each sold off 3%. For-profit schools also took a hit. I've been writing about two of these in this space: DeVry (DV) and ITT Educational (ESI) each sold off a little over 2% in today's trade. Volume on both were lower than Friday.
Today's stock pick is Perrigo (PRGO). They supply store-brand goods and over-the-counter and prescription generic drugs to retailers across the country. They sell everything - think about generic cold remedies, creams, ointments, nasal sprays, shampoos, etc. They are the nation's top supplier of store brand generic products. There are a few growth drivers working for them right now. First, the recession is driving all consumers to squeeze the most out of their dollars. Switching to generic store brand products is one way consumers accomplish this. People are still getting sick, so there's an increase in the purchases of generic store-brand remedies. Also, the HMO's and other managed-care health plans continue to shift costs onto their members, so Perrigo is seeing a growth in the amount of generic pharmaceutical products being sold by nationwide retailers like Walgreens and CVS. Perrigo has pulled back a bit from it's recent high around $67. It's floated back down to the $64 range and seems like it might consolidate here for a bit. I think this makes a good entry point and would like to see if it can step it's way back to the $67 range.
As always, stay cautious and happy trading! Check out Wall Street Survivor below and invite your friends to play. It's free! Have fun!
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