As the stock market rally continued with gusto, more IBD 50 stocks broke out of bases this week than in recent weeks. Elite growth stocks have picked up momentum and started setting up as market breadth increases. Several, such as MongoDB (MDB), which partners with Amazon (AMZN), are breaking out as major stock market indexes hit all-time highs.
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MongoDB Stock Breaks Out
MongoDB stock broke out of a cup-with-handle base with a 412.67 buy point in late November, but then shares sold off following MongoDB’s October-ended quarterly results on Dec. 5. While the company topped earnings and sales estimates, its outlook disappointed Wall Street.
MongoDB started to consolidate at that point and formed another, higher base with a 442.84 entry. It also formed a handle with an early buy point of 426.51. The stock jumped 10.3% and reclaimed its 10-week moving average forcefully the week of Feb. 2, setting the stock up for a breakout. Now, MongoDB stock is extended from that higher buy zone on the stock market, which reached to 464.98.
Quarterly earnings growth has exploded, with a 317% increase in its most recent quarter. Sales growth ranged from 29% to 40% in the last three quarters. Its cloud-based document database service, MongoDB Atlas, integrates with the Amazon Bedrock service. The technology uses artificial intelligence tools to design Amazon Web Services applications.
AAON (AAON) broke out of a newly formed flat base with a 75.24 buy point. The heating, ventilation and air conditioning stock bypassed the top of its buy range at 79 as it reached an all-time high Friday. The stock tested its 10-week line and created a bullish three-weeks-tight pattern within the short base, before breaking out.
Its IBD Accumulation/Distribution Rating of A shows heavy institutional buying over the last 13 weeks. In addition, its 1.4 Up/Down Ratio supports a move higher, as more investors are getting in than out of the growth stock.
Stock Market Rally Adds More Names
Tenable (TENB) broke out of a cuplike base with a 49.77 buy point in heavy volume, and is in a buy zone reaching to 52.26. An early handle-like entry, which was also part of a three-weeks-tight pattern, was seen at 48.51. A third buying opportunity appeared at a trendline breakout around 47.70.
The cybersecurity stock gapped up 5.3% in heavy volume and broke out after Tenable reported fourth-quarter profits and sales that beat views, on Feb. 6. Quarterly earnings grew 108% on 16% sales growth. The stock’s high institutional backing is reflected in the breakout’s heavy volume, its A/D Rating of A and its high 1.9 Up/Down Ratio.
Among other growth companies on the stock market, customer engagement platform operator Braze (BRZE), broke out of a cuplike base with a 58.67 entry, and is in a buy zone stretching to 61.60. An early handle entry was also seen at 57.59.
Braze stock sank even after the company reported a smaller-than-expected October-ended quarterly loss and higher sales, on Dec. 6. The stock turned around in mid-January to reclaim its 10-week line. The company is not yet profitable but sales growth has ranged from 31% to 33% in the last three quarters.
Follow Kimberley Koenig for more stock market news on X/Twitter @IBD_KKoenig.
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