Best Stocks To Watch Building Breakouts And Buy Zones Right Now

Stock market history shows the best stocks to buy and watch often hail from the top-ranked industry groups. It’s a telltale clue to help jump-start your search for potential big winners.

This stock screen identifies 23 top-rated companies found in the Top 20 industries, with semiconductor sector stocks like Broadcom (AVGO), Advanced Micro Devices (AMD), Applied Materials (AMAT) and Mobileye (MBLY) leading the charge.


Monolithic Power Systems (MPWR), Lattice Semiconductor (LSCC), Lam Research (LRCX) and KLA (KLAC) have also etched their names on the list.

Beyond chip stocks to watch, security play Axon Enterprise (AXON) finds room alongside Airbnb (ABNB).

Plus, Builders FirstSource (BLDR) joins homebuilders Meritage Homes (MTH), PulteGroup (PHM), Tri Pointe Homes (TPH) and Lennar (LEN).

Is A Reality Check Coming For Hot Semiconductor Stocks?

Top Funds Scoop Up AVGO, MBLY And Other Stocks To Watch

This month’s list of new buys by the best mutual funds reveals strong demand for many of these industry group leaders. Chip stocks AVGO, MBLY, AMAT, MPWR and LSCC all make both screens.

Building sector stocks MTH, PHM and BLDR also earn that distinction, alongside AXON stock and HubSpot (HUBS).

Both screens identify where savvy investors are placing their bets, helping investors uncover the most promising stocks to watch.

Top Stocks To Watch In Top Industry Groups

To make this screen of top stocks to watch in the top-ranked industries, each company must meet the following criteria:

Stocks To Watch Launching Breakouts And Buy Zones

A scan of the table below highlights several stocks showing strength. Just among semiconductor stocks, several names are setting up or expanding recent breakouts.

With its relative strength line already hitting a new high, AMAT stock is closing in on a 125.02 buy point. MPWR and LRCX stock also continue to set up new moves.

Meanwhile, AMD and LSCCC stock have climbed beyond their buy zones and are now extended.

Best Stocks To Watch In Top-Ranked Industries

Company Symbol Comp Rating EPS Rating RS Rating SMR Rating A/D Rating
Applied Materials AMAT 99 84 92 A B
Broadcom AVGO 99 95 91 A A-
Axon Enterprise AXON 99 90 98 A A-
HubSpot HUBS 99 99 93 B B+
KLA KLAC 99 98 87 A B
Lam Research LRCX 99 95 89 A B+
Lattice Semiconductor LSCC 99 99 98 A B
Monolithic Power Systems MPWR 99 99 93 A B
Meritage Homes MTH 99 97 95 A B-
Skyline Champion SKY 99 98 93 A B
Airbnb ABNB 98 80 88 A A-
Advanced Micro Devices AMD 98 80 93 B A
Mobileye MBLY 98 97 96 B A-
PulteGroup PHM 98 99 95 A B-
Tri Pointe Homes TPH 98 97 95 B B+
Texas Roadhouse TXRH 98 84 93 A A
APi Group APG 97 87 92 A B-
Old Dominion Freight Line ODFL 97 97 92 A B+
Saia SAIA 97 91 94 A B
Builders FirstSource BLDR 96 97 95 A B-
Fastenal FAST 96 90 81 A B
Lennar LEN 96 87 94 B B
Owens Corning OC 96 94 81 A B-
Data as of March 17, 2023

Build Your Watchlist With Stock Ratings And Stock Lists

Running stock screens with the IBD Stock Screener or MarketSmith is an effective way to streamline your research.

You can also zero in on the best stocks to watch using IBD stocks lists based on a wide range of preset filters. You’ll find top-rated stocks meeting the criteria of the IBD 50, IBD Sector Leaders, IBD Big Cap 20, IPO Leaders and more.

In the screen above for the best stocks to watch in the top industries, you’ll find Airbnb on the IBD Big Cap 20. Crocs appears on the IBD 50 list of top growth stocks.

Once you’ve put together potential stock picks for your watchlist, you’ll want to evaluate your ideas with IBD Stock Checkup. With pass, neutral or fail ratings for each your stocks, Checkup provides a detailed look at both the fundamental and technical health of the companies on your watchlist.

Based on the CAN SLIM system, the Composite Rating provides an overall score, taking into account each of the IBD ratings. The single score considers how a company and its stock are performing in terms of annual and quarterly earnings growth, relative strength compared the rest of the market, sales, profit margins, and institutional demand.

But note that you should not buy a stock solely on its ratings or placement on one of IBD’s stock lists. No matter how compelling a company’s story may seem, savvy investors will always check the technical action in the stock chart before buying.

Check The Chart To Know When To Buy Stocks

Using stocks lists helps you zero in on the best stocks to watch. Stock ratings look under the hood to diagnose a company and its stock’s fundamental and technical health. Both stock lists and stock ratings help you understand what to buy. But to fully understand when to buy stocks, take a look at the stock chart.

It’s also critical to understand what type of environment you’re currently in. Is it a bull market when most stocks go up? Or a bear market when most stocks go down? Or is it a volatile, choppy and uncertain time when the market indexes tend to fail to make any sustained headway? That was the case for much of 2022.

Use stock charts to evaluate both the market indexes and individual stocks. Charts will help you pinpoint the best time to buy stocks by identifying support and resistance, as well as buy points and buy zones. Using charts also helps you identify warning  signs and when to sell stocks.

So when searching for potential stock picks and stocks to watch like CROX, ABNB, TXRH and others, always check the charts. They provide the most unbiased diagnosis of a stock’s health.

Follow Matthew Galgani on Twitter at @IBD_MGalgani.


Is A Reality Check Coming For Semiconductor Stocks?

Top Funds Shovel Billions Into These Five Sectors

How To Invest: Top Industry Groups Beget Top Stocks

Generate New Stock Ideas With IBD Stock Screener

Identify Bases And Buy Points With This Pattern Recognition Tool