Disclaimer: Peter Kurata does not own any of the discussed securities in his Covestor CANSLIM model.
August 2, 2010: July started off with the S&P 500 Index correcting down, between June 25, 2010 and July 2, 2010, then follow-thru’d (FTD) on July 13, but after the two 2 previously failed FTD in June, cautious measures are being taken before entering this one (Google Finance). This rally resulted in the S&P 500 Index climbing back up to the 200 day moving line but has been met with some resistance, so a push above this will confirm this FTD. This attempt does have more stock leadership, which increases the odds of success. Leaders are Foreign Banks (Chile’s Banco Santander (SAN), Bancolombia (CIB)), Cloud Computing (Salesforce (CRM), VMWare (VMW), and LED lighting (Cree (CREE), Veeco Instruments (VECO)).
This month’s stock spotlight is Veeco Instruments (VECO) which provides manufacturing equipment for a significant portion of the world’s LED lighting makers (Yahoo Finance). Their second quarter earnings more than tripled (Yahoo), which beat analyst expectations. The company also reported a backlog of orders and raised the company’s outlook. This will also be good news for CREE Inc. (CREE), a maker of LED lighting. LEDs are everywhere: computer screens, TVs, car lights, street lights, home and business lighting. More expensive than incandescent or fluorescent lights, VEECO’s equipment aims to greatly decrease its price. LED’s also have other advantages; less power consumption, up to 1/10th that of an incandescent bulb and less maintenance.
