Sunday, December 30, 2007

Top Stocks of 2007 - BIDU

Next up to look at is the Chinese Google, BIDU. By my calculations, this stock made a move of over 200% in about eight months - from $125 in May to $400 in December. This move started off the way many big moves do - with an earnings related gap-up. A lot of investors find this type of gap hard to buy - they feel it is risky. However, I have found that these type of big gaps that are caused by blowout earnings usually lead to continued momentum for the particular stocks, sometimes for months, sometimes for years. I will write more about this idea in the coming weeks, and the Stockbee blog has written extensively about this earnings-related phenomenon as well. In my final post about top stocks of 2007, I will look at three small-cap stocks that made big moves, all starting in some manner with a earnings-related gap.

First Chart - The Breakout and First Base

Second Chart - The Big Move and Current Base

Charts from Telechart2007, courtesy of Worden Brothers

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