Traders Say These 2 Stocks Are Still Strong Buys After Hitting Fresh Highs This Week

These 5 stocks hit new all-time highs this week, but traders say only 2 of the names are still buys now.

For all the fuss over meme stocks this week, Reddit’s favorite names took a tumble today as the S&P 500 was locking in a new all-time high.

AMC Entertainment (NYSE: AMC) dropped more than 13% today. Clover Health (NASDAQ: CLOV) dropped more than 15% after gaining more than 78% Monday through Wednesday. Clean Energy Fuels (NASDAQ: CLNE) shares sank nearly 16%, while Geo Group (NYSE: GEO) dropped almost 20%. And OG meme stock GameStop (NYSE: GME) plummeted a whopping 27%.

Meanwhile, the S&P 500 hit a record 4,239 as investors shrugged off higher-than-expected inflation as “transitory.”

With the index on the rise, several non-meme stocks have hit fresh highs this week as well, including ADP (NASDAQ: ADP), eBay (NASDAQ: EBAY), Nvidia (NASDAQ: NVDA), Target (NYSE: TGT), and T-Mobile (NASDAQ: TMUS).

But of these names, traders say only two of the stocks are still buys now.

TradingAnalysis.com founder Todd Gordon has his eye on Nvidia.

“You’re seeing a rotation back into the large-, medium-cap growth relative to value,” Gordon said. “And Nvidia is the play. This is obviously the largest GPU and AI play out there.”

Gordon noted that Nvidia has “been in a massive uptrend since 2015. We don’t show resistance until about $1,650. Nvidia is the second largest holding stock in my portfolio, behind Apple.”

Gordon’s target of $1,650 implies upside of nearly 137% from Thursday’s close at $697.

“We just broke out of [a] year-long range between about $650 and $500,” Gordon added. “So if you have any pullback to $650, it’s buyable.”

BMO Capital Markets analyst Ambrish Srivastava recently upgraded Nvidia to Outperform from Market preform.

“While there is no one single event we can point to which has led us to change our thinking, the continued execution on the data center side, along with the latest product rollout, has helped,” Srivastava said in a note. “We believe Nvidia is uniquely positioned to continue to benefit from a massive shift in the compute landscape.”

When the company reported fiscal first quarter earnings last month, it said its data center chip sales rose 79% to $2.05 billion. Revenue from gaming doubled to $2.76 billion in the quarter.

“We had a fantastic quarter, with strong demand for our products driving record revenue,” CEO Jensen Huang said in the earnings release. “Our Data Center business continues to expand, as the world’s industries take up Nvidia AI to process computer vision, conversational AI, natural language understanding and recommender systems. Nvidia RTX has reinvented computer graphics and is driving upgrades across the gaming and design markets. …Across industries, the adoption of Nvidia computing platforms is accelerating.”

Aside from Nvidia, New Street Advisors’ Delano Saporu is watching another name.

“I really like ADP here,” Saporu said. “Their highest margin business, their employer services segment, that’s going to have a lot of tailwinds with our expanding economy. We’re back on the mend. These are things that benefit well for the … business.”

ADP shares are up nearly 26% since bottoming out in mid-January.

“They’re returning money and rewarding shareholders with $1 billion in share repurchases,” Saporu added. “They also had about $1.5 billion in dividends. This is a company that I really think is strong.”

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