There are just five stocks listed on the S&P 500 valued above $1,000 a share, but which ones are poised to keep rising?
The quintet contains big-time names like Amazon.com Inc. (Nasdaq: AMZN), Google parent Alphabet Inc. (Nasdaq: GOOGL) and online travel company Booking Holdings Inc. (Nasdaq: BKNG) to lesser-hyped quantities like AutoZone Inc. (NYSE: AZO) and homebuilder NVR Inc. (NYSE: NVR)
Two experts, Simpler Trading Director of Options Danielle Shay and Miller Tabak Chief Market Strategist Matt Maley, debated the topic of which ones are really worth their sky-high valuations this week on CNBC’s “Trading Nation.”
And, according to the experts, two are worth buying right now.
“For me personally, I like AutoZone,” Shay said about the car parts company, which is trading around $1,070 this morning. “If you think about AutoZone, first of all, it’s been very consistent over the course of the last 20 years. Even throughout 2008, 2009, you just saw a little bit of a drop. Over the course of the last couple of years, we’ve seen relatively consistent earnings growth, especially out of the last eight of 10 quarters. It is a little bit oversold at this moment in time.
“I’m looking for a potential oversold bounce into the next earnings state, but also I think on a larger macro scale, once we do see this business cycle slow down, and once we do see the economy stutter a little bit, companies like AutoZone, who sell parts to people who want to fix their cars instead of buy a new one, I think they’re going to remain very strong.”
Maley agreed but said AutoZone is approaching a critical level of support.
“It’s getting down to the $1,030 level that was rock solid support in both … August and October of last year, and if it breaks below that level of $1,030 it’s going to be very negative,” Maley rebutted. “However as Danielle also said, it’s very oversold so hopefully it can bounce. So whichever way it breaks over the next week or so is going to be very important.”
Maley then pointed to his top $1,000-plus stock: Amazon, which “looks very good” and was trading around a hefty $2,175 and climbing this morning.
“People forget the stock was stuck in a sideways range during the fourth quarter (2019) while the rest of the market was much higher,” he said. “So the stock finally in January and February has broken out in a meaningful manner and that’s very bullish. It is overbought near-term and it may have to pull back a little bit to work off that overbought condition, but the breakout has been significant enough that in this momentum-driven market, it could have a lot more upside to play catch-up with some of those other high-flying names.”
Full disclosure: The author of this piece holds a small position in AMZN.
