With the stock market mending itself, the number of stocks nearing buy points is trickling higher. MercadoLibre, Charles Schwab, Boston Scientific and SAP are forming double-bottom bases. Exelixis is in a cup base.
A market rally has gained momentum, but still faces pervasive risk, so investors need to choose carefully. This week's stocks to watch all have relative strength lines near highs, which is a good way to identify emerging leadership.
Exelixis Stock
Exelixis stock climbed back above its 50-day moving average last week. The cup pattern's buy point is 40.02, but investors could use Wednesday's high at 37.67 as an early entry.
In an industry where most companies aren't profitable, the biotech posted earnings gains of 6%, 171%, 370% and 67%. Its EPS Rating of 92 is seventh best among more than 700 companies in the group. Sales rose 4%, 36%, 14% and 18% the same periods, according to IBD MarketSurge.
Q1 2025 earnings should come around mid-May.
The company specializes in cancer treatments. Cabometyx is used for several types of kidney, liver and thyroid cancer. Cometriq is used to fight thyroid cancer. A month ago, Exelixis won Food and Drug Administration approval to expand use of Cabometyx for certain patients with some advanced tumors.
Exelixis stock has an average true range of 3.84%. It is up more than 12% year to date.
Stocks To Watch: MercadoLibre Tries To Break Out
MercadoLibre has broken out of a double-bottom base, clearing the 2,202 buy point.
Latin America's largest online shopping company was added to IBD SwingTrader Friday. While price and volume were lackluster Friday and for the week, the stock's strong relative strength line could mean it's just a matter of time until the stock rallies to new highs.
MELI stock has an upward but volatile trajectory. Shares have a tendency to break out but then fall back within a few days or weeks before basing again
MercadoLibre will likely report first-quarter results on May 7. FactSet's consensus EPS estimate is $8.27, for a 22% increase. Sales are expected to climb 26% to $5.47 billion. The company's earnings grew 71%, 103%, 9% and 288% the past four quarters. Sales rose 43%, 49%, 41% and 42%.
Often compared to Amazon.com, MercadoLibre also offers a payments platform plus logistics and advertising services.
Its EPS Rating of 98 is second highest in the internet retail industry group, which has more than 80 stocks. MercadoLibre has an ATR of 4.88% and shares are up 31% year to date.
Schwab Among Stocks To Watch
Charles Schwab also has formed a double-bottom base, and shares are close to the 81.24 buy point. Its Accumulation/Distribution Rating of D+ suggests the stock may need more time before breaking out to new highs.
The stock climbed but pared most gains April 17, when the brokerage firm beat first-quarter profit and sales expectations.
Many of the firm's key metrics improved, too. Daily average trading volume rose 17% quarter over quarter due to a sharp increase in market volatility. Net new assets jumped 44% from the year-ago period. Total client assets rose 9% to $9.93 trillion and brokerage account openings rose 8% to 37 million.
Schwab averaged EPS growth of nearly 30% the past three quarters, according to IBD Stock Checkup. Analysts expect this year's earnings to rise 31%.
Schwab stock has an ATR of 4.55% and has climbed 8% this year.
Stocks To Watch: Boston Scientific Near Entry
Boston Scientific is another stock forming a double-bottom base, this one with a 104.35 buy point. The stock gapped back above the 50-day moving average Wednesday after the company's earnings report. A trendline touching the highs in the base provides an alternative entry at Wednesday's high of 102.37.
Boston Scientific — Thursday's IBD Stock Of The Day — also raised its full-year outlook. It forecast 12%-14% organic sales growth, up from a previous forecast of 10%-12% growth. It expects adjusted earnings of $2.87 to $2.94 per share, up 7 cents at the midpoint.
Evercore ISI analyst Vijay Kumar was impressed that management was able to raise guidance despite tariff headwinds.
The company makes minimally invasive technologies for coronary artery disease and aortic valve ailments. It also makes devices for endoscopy and urology, such as kidney stones, and an implantable device for chronic pain, among many other products.
The stock has nearly doubled since it initially broke out to new highs in November 2023. Yet, it is still in an early-stage base. It has an ATR of 4.1% and shares are up 14% so far this year.
German Software Firm Another Stock To Watch
SAP is forming a double-bottom base with a 280.44 buy point. The stock found support in a pullback to the 200-day moving average earlier this month and is now 1% away from the entry.
Germany's largest software firm jumped more than 7% Wednesday, after earnings and sales came in above analysts' expectations. TD Cowen analyst Derrick Wood highlighted SAP's forecast of "solid growth durability" in current conditions.
The company's profit performance is turning around. EPS fell 13% and 5% across two quarters before Q1's jump to 89% growth, per FactSet data. Sales rose 7%, 12%, 6% and 19% the past four quarters. Analysts expect full-year profit to increase 48% with sales up nearly 20%.
A cloud-computing and AI push is driving growth.
SAP stock has more than doubled since it broke out of a flat base in November 2023. Its current base is the stock's deepest price decline since the 2022 bear market, and undercut a previous December-January pattern. With that, SAP chart reset its base count, eliminating the risk of a late-stage pattern.
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German stocks in general are performing well, with iShares MSCI Germany ETF up more than 23% this year.
SAP, which is up 13% year to date, has an ATR of 3.57%.
