Young Guns – APO, HTHT, LNKD

Apollo Global Management (APO)

My Young Guns screen returned 13 stocks that had positive weeks and met my young growth stock criteria. Narrowing the screen to stock that were up at least 3% on the week left me with only three stocks.

Apollo Global Management (APO)

APO was up 7% this week on average volume. It closed up, but well off its high in huge volume on Monday. The stock pulled back a bit on Tuesday, then jumped higher Wednesday and Thursday on lighter volume, and finally pulled back on Friday in light volume. APO is extremely extended from the first stage cup with handle base that it broke out of in September. Since that breakout, the stock has seen nine weeks of accumulation and six weeks of distribution.

In its most recent quarter, APO reported earnings growth of 344% and sales growth of 79%. Annual earnings are expected to increase 139% in 2013, but then slow down in 2014. The stock has increased fund ownership slightly over the past three quarters and is in a strong industry group.

China Lodging Group Ads (HTHT)

HTHT was up 4.4% this week on volume that was 57% below average. The stock was down a bit on Monday, then shot higher on Tuesday and Wednesday. Thursday saw a slight pullback, but it continued higher on Friday. There weren’t any days this week with impressive volume. HTHT is now slightly extended from a first stage consolidation that it broke out of in early January. The stock logged two weeks of accumulation as it broke out, but volume has been very light ever since.

HTHT reported earnings growth of 69% and sales growth of 46% in its most recent quarter and is scheduled to report earnings again on March 6. Annual earnings for 2012 are projected to be up 52% and then another 40% in 2013. Fund ownership has increased slightly over the past year, but return on equity is only 6% and the stock’s industry group has been weak.

Linkedin Corp (LNKD)

LNKD was up 6.2% this week on volume that was 31% above average. The stock fell in light volume on Monday, then recouped some of that loss in better volume Tuesday. Wednesday was the biggest gain of the week and the biggest volume as well. The stock then pulled back slightly on Thursday and then made a new high on Friday. LNKD is now well extended from a first stage cup with handle base that it broke out of in early January. Since that breakout, the stock has logged six weeks of accumulation and no distribution.

In its most recent quarter, LNKD reported earnings growth of 192% and sales growth of 81%. The company has posted triple digit earnings growth in four of the past five quarters and has eight straight quarters of impressive sales growth. Fund ownership has more than doubled in the past year, however return on equity is slightly below what we look for at 13% and the stock’s industry group is just outside of the range we look for.