The industrial stocks have been getting clobbered as the trade war lumbers on, but Jim Cramer said during his Monday "Mad Money" program that there is one bucking the trend, and that's Dover Corp. (DOV) .
Dover is a company you've probably never heard of. It makes fluid handling systems, engineered systems for a host of different industries and refrigeration systems for industrial uses. Back in 2016, Dover was primarily an energy play thanks to an ill-timed acquisition. But in 2017, Dover took the necessary steps to spin off its energy assets and focus on diversifying its remaining businesses overseas.
With a new CEO last year and an activist investor, Dover has been trimming its portfolio of businesses, cutting costs and bolstering its bottom line. When the company last reported, it delivered 6% revenue growth with rising gross margins that prompted management to boost the lower end of their full-year guidance.
Cramer said there aren't many industrials that can beat the gravitational pull of the trade war, but with shares up more than 45% for the year to date Dover is one company that has done it.
Now let's turn our attention to the charts and indicators.
In this daily bar chart of DOV, below, we can see that prices just made a new high for the move up on this chart. DOV is trading above the rising (bullish) 50-day moving average line as well as the slower-to-react 200-day line. The 200-day line was successfully tested in August and again this month. Buyers used the decline to this indicator as a chance to buy.
The daily On-Balance-Volume (OBV) line has just turned up to make a new high to support and confirm the price strength -- no bearish divergence here. The trend-following Moving Average Convergence Divergence (MACD) oscillator just moved back above the zero line for a new outright go long signal.
In this weekly bar chart of DOV, below, we can see that prices have nearly doubled in the past three years. DOV is above the rising 40-week moving average line as prices make a new high. The weekly OBV line shows a long uptrend to support the bull move to the upside. Buyers have been more aggressive all the way up. The weekly MACD oscillator has just turned higher for a new outright go long signal.
In this Point and Figure chart of DOV we can see the breakout to a new high at $103.41 and the upside price target at $129.35.
Bottom line strategy: DOV seems to have everything going for it. A positive fundamental story and great charts. Go long DOV at current levels, risk a move below $99 for now and look for gains to around $130, maybe higher by the end of 2019.