Raytheon, Shell Lead Five Stocks Setting Up, Breaking Out From Strong Sectors

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Your stocks to watch for the week ahead include defense giant Raytheon Technologies (RTX), oil major shell Shell (SHEL), storage provider CubeSmart (CUBE) and medical names Horizon Therapeutics (HZNP) and Edwards Lifesciences (EW). Those stocks are either in bases or consolidating.




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The defense, energy, medical and real estate investment trust sectors are among the best-performing areas of the stock market. All the stocks mentioned above also have peers that are doing well.

Raytheon Stock

Raytheon stock dipped 0.6% to 100.40 in Friday’s stock market today. The stock was in a flat base with a 104.44 buy point.

Arguably, RTX stock is actionable from a rebound off its 10-week line. However, investors looking for an early entry might wait for Raytheon to clear its March 25 high of 125.97, after shares hit resistance Friday just shy of that key level.

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. The U.S. has been sending missiles and other equipment to Ukraine. That includes the Javelin anti-tank missile, made by Raytheon and Lockheed Martin (LMT).

The U.S. is sending Raytheon’s advanced Patriot Missile defense system to some NATO allies. Some NATO countries in turn are sending Ukraine older anti-aircraft defense systems.

Raytheon, Lockheed, General Dynamics (GD) and Northrop Grumman (NOC) are all just off highs, consolidating after surging near the start of Russia’s Ukraine invasion.

Raytheon stock has an 85 Composite Rating and a 71 EPS Rating.

Shell Stock

Shell stock rose 1.2% to 56.09 on Friday. The stock briefly cleared a flat-base buy point of 56.23.

The relative strength line for SHEL stock is at a multiyear high. The RS line, the blue line in the charts provided, tracks a stock’s performance vs. the S&P 500 index.

Shares have a 98 Composite Rating. Their EPS Rating is 77.

As with other stocks to watch here, Shell, a big oil and gas explorer and producer, has rivals that are also holding up. Exxon (XOM) has a 99 Composite Rating. BP (BP), which is consolidating, also has a 99 Composite Rating.

Oil prices have seesawed as investors assess the impact of the Russia-Ukraine war and China’s pandemic lockdowns on supplies. Oil prices spiked after the conflict began, as investors bet on further supply disruptions. Occasional signs of progress in peace talks between Russia and Ukraine have sent prices lower. Markets have also weighed whether China’s lockdowns would reduce energy usage.

Still, there’s no question that crude oil futures are well above levels from just a few months ago. Natural gas futures also are at 13-year highs in the U.S. European energy prices have skyrocketed.

CubeSmart Stock

CubeSmart, a real estate investment trust that runs self-storage facilities, was down 0.5% to 53.45 on Friday. Shares briefly edged past the 541.16 buy point from the cup-with-handle base.

Extra Space Storage (EXR), another self-storage real estate investment trust, also recently broke out of a cup-with-handle base and was in a buy zone.

Demand for self-storage space rose after the pandemic prompted more people to relocate. During CubeSmart’s most recent earnings call in February, executives said pandemic-induced trends “seem to have normalized” in parts of the Northeast. The company also recently bought Storage West, helping it expand in the western U.S.

REITs are yield plays, so rising interest rates often can be a negative. But investors are turning to property REITs as defensive plays while growth stocks struggle. CUBE stock and other storage REITs do offer at least decent EPS growth.

Horizon Therapeutics

Horizon Therapeutics stock was up 0.7% to 113.17 on Friday. Shares broke out from a handle buy point of 110.23 on Thursday. That handle entry coincides with resistance around 110 late last year.

The company makes Tepezza, a thyroid eye disease medication, along with several other treatments. Shares have a 93 Composite Rating and an 83 EPS Rating.

Other biotechs and drug stocks, like Vertex Pharmaceuticals (VRTX), Regeneron (REGN) and Eli Lilly (LLY), are extended.

Edwards Lifesciences Stock

Edwards Lifesciences stock was up 0.15% to 123.92 on Friday. Shares were in a cup base with 131.83 buy point. The RS line for EW stock is already at a new high.

The company, which makes heart valves, has a 91 Composite Rating. Its EPS Rating is 79.

Shockwave Medical (SWAV), was also in a cup base with a 249.83 buy point. The company’s technology uses sound waves to break up calcification in arteries and facilitate blood flow.

Medical device and product makers are on an upswing as Covid wanes, spurring a revival in elective medical procedures.

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