Investors seeking the best stocks to buy and watch can use Investor’s Business Daily’s (IBD) Composite Rating as a shortcut. This rating combines data from five other IBD stock ratings, including EPS, Relative Price Strength, Accumulation/Distribution, SMR, and Industry Group Relative Strength.
The Composite Rating helps investors gauge a company’s fundamental quality and chart action compared to all other stocks. The rating ranges from 1-99, with 99 being the highest.
Focus on stocks with a Composite Rating of 90 or higher. Those with ratings of 95 or higher are particularly noteworthy. Use IBD Stock Checkup lists to find industry leaders, which can be accessed through stock quotes at Investors.com or other resources.
Investors should not buy stocks solely based on their Composite Rating but also consider breakouts past proper buy points from base formations. Nvidia chipmaker Taiwan Semiconductor Manufacturing (TSM), with a Composite Rating of 93, is a notable example. After staging a breakout above a buy point in May, its shares rallied 30% before reaching profit-taking zones.
Other top stocks to watch include Klaviyo (99), Trip.com Group (97), Alphabet (97), and Walt Disney (94). Follow IBD’s Near Pivot list for stocks approaching buy points, such as Taiwan Semiconductor Manufacturing (98) and Chipotle Mexican Grill (93).
Source: https://www.investors.com/how-to-invest/investors-corner/nvidia-chipmaker-tsm-stock-ibd-composite-rating