14 Large-Cap Stocks Reach New 52-Week Highs, but Fundamentals in Question
A recent list of stocks hitting new 52-week highs has sparked questions about whether business fundamentals justify their prices. The list, compiled by Trefis, includes 14 large-cap US and Canadian-listed companies with a market value above $40 billion. Among them is Johnson & Johnson (JNJ), the largest company on the list, with a market value of approximately $662.5 billion.
The strongest one-month run belongs to Phillips 66 (PSX), up 25.0% over the past month. However, the wider S&P 500 has returned -0.8% over the same period. A closer look at some of these companies reveals mixed results. While Johnson & Johnson trades at a multiple of 31.5 times trailing earnings and has seen revenue grow by 8.1%, Pfizer (PFE) trades at 38.2 times trailing earnings, with its revenue declining by 0.2% over the past year.
The Trefis High Quality Portfolio systematically screens for businesses that sustain a run based on fundamentals, holding about 30 quality companies with rules instead of excitement. This portfolio has outpaced a benchmark combining the S&P 500, S&P Mid-cap, and Russell 2000 indices.