Four Dow stocks, including Walmart, are trading at extremes

A handful of Dow stocks are trading well above their 200-day moving averages. Despite trading at relatively extreme levels, some investors still see them as buys.

Shares of Walmart, Intel, Caterpillar and Boeing are respectively trading 22 percent, 24 percent, 32 percent and 33 percent above their 200-day moving averages.

Walmart has seen a record run this year, on pace for its best since 1999. Still, the stock is a buy at these levels, said Mark Tepper, president and CEO of Strategic Wealth Partners.

"We love Walmart; I've been saying that for a while," he said Thursday on CNBC's "Trading Nation."

The stock, up 42 percent in 2017, is trading at these levels "for good reason," Tepper said, pointing to a strong consumer as holiday retail sales are projected to rise year over year.

Although consumer confidence is still historically high as measured by the University of Michigan's monthly survey, the most recent report released Friday morning showed a month-over-month decline.

The company has successfully figured out how to compete in the e-commerce space, Tepper believes. "They've done everything they can to evolve with the changing consumer environment to compete on an e-commerce level with Amazon," he said.

On a technical basis, all four stocks' respective momentum appears strong, said Craig Johnson, chief market technician at Piper Jaffray. But shares of Intel look most well-positioned, he said Thursday. The stock has risen 27 percent this year.

"You've had a recent breakout this year, making new highs for the first time in multiple years," he said.

"That set-up … I like more than the others, from a risk-reward perspective," he said.

Shares of Intel were lower on Friday, while shares of Walmart were flat.

Disclosure: Mark Tepper's firm owns Walmart stock.


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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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