'Old Economy' Stocks Surge On AI-Fueled Earnings, Data Tailwinds

Blockhead
2024-11-06

DuPont de Nemours (DD) beat earnings estimates early Tuesday led by higher artificial intelligence and China demand. Other "old economy" stocks Emerson Electric (EMR) and Louisiana Pacific (LPX) scored earnings breakaway gaps. Cummins (CMI) also made a powerful earnings move.

The major indexes rose solidly on Election Day.

'Old Economy' Stocks But DuPont Has AI Tailwind

On a per-share basis, DuPont, a manufacturer of specialty materials, chemicals and agricultural products, delivered a 28% earnings jump for the third quarter. That was the best gain since Q3 2021.

DuPoint easily beat earnings estimates but slightly missed on revenue. Semiconductor technologies sales jumped 20% on demand recovery led by AI technology ramps and China, the company said. DuPont continues to work on a three-way split-up of the company.

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Shares popped 6.5% in Tuesday's stock market trading. DuPont stock gapped up above the 50-day moving average and broke a trendline, offering an early entry. It's now 3% below a 90.06 buy point from a flat base, the MarketSurge chart shows.

In intraday action Tuesday, Louisiana-Pacific stock popped 6.9%, gapping above the 50-day line and breaking a trendline. Shares hit 112.06 intraday, briefly topping a 109.73 buy point from a flat base, base-on-base pattern. Investors could treat the wood-products giant as actionable now.

Emerson Electric stock staged a 67% earnings gap-up on Tuesday, topping a 112.77 cup-with-handle buy point.

Cummins stock rocketed 8.6% and is now extended from a 322.83 entry, meaning shares are no longer in range from that buy point. However, investors could use a buy off the 10-week line or a three-weeks-tight entry at 340.82 as places to buy or add shares.

Emerson Electric, Louisiana-Pacific, Cummins Earnings

On Tuesday, Louisiana-Pacific raised full-year guidance after smashing Q3 earnings views. The building solutions provider's siding business led the way with record earnings on 22% sales growth.

Cummins reaffirmed its full-year outlook after posting a 29% Q3 earnings jump. The maker of power train and industrial systems cited improvements in its power systems and distribution units.

Emerson Electric gave solid 2025 guidance after beating Q4 earnings and revenue views. The maker of pressure safety valves and regulators also proposed to buy the remainder of Aspen Technology (AZPN) for $240 per share in cash. Emerson seeks to sharpen its focus on industrial automation. Aspen, an industrial software technology provider, aligns with that strategy.

Separately, Bernstein analysts initiated coverage of Eaton (ETN) with an outperform buy rating and $382 price target. The analysts noted megatrends in power demand including data center buildouts and infrastructure projects.

Last week, Eaton raised full-year guidance after a 15% earnings gain for the third quarter. The power management company taps domestic and global electric markets as well as aerospace.

ETN rose slightly Tuesday, about 3% below a 345.19 buy point.

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