Tuesday's IBD 50 Stocks To Watch pick is health savings account giant HealthEquity (HQY), which is approaching a new buy point amid a volatile stock market. That makes HealthEquity stock one of the best ideas to buy and watch right now.
HealthEquity is a leading provider of health savings accounts. Health savings account contributions are made pretax, like 401(k) contributions. But distributions are tax-free, as long as they go toward medical expenses. Further, there are no mandatory distributions. That makes HSAs the most tax-advantaged retirement account.
↑ X NOW PLAYING Stocks Slash Losses To Close Mixed; Planet Fitness, Wix, Baker Hughes In FocusOn Dec. 9, HealthEquity reported adjusted earnings of 78 cents per share on sales of $300.4 million, which represented year-over-year increases of 30% and 21%, respectively.
For the fiscal year ending in January, Wall Street expects the company's earnings will grow by 40%, with an increase of 18% in fiscal 2026, per IBD MarketSurge.
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On Nov. 6, HealthEquity stock surged nearly 10%, hitting new highs and breaking out further above an 88.26 buy point in a cup base.
Following a brief pullback to the 10-week line, shares are forming the right side of a cup base, per IBD MarketSurge chart analysis. The correct buy point is 105.82 and the stock is just 2% away from that entry, as shares rallied 1.4% Tuesday morning.
Bullishly, the relative strength line is hitting new highs ahead of the breakout. That triggers the RS line blue dot signal.
The RS Line Blue Dot feature combines the relative strength line with MarketSurge Pattern Recognition. When a stock's RS line hits a new high, while the stock is forming a base or breaking out, then the Blue Dot appears on the MarketSurge weekly or daily chart.
The RS line is the blue line on all IBD daily and weekly charts as well as in MarketSurge charts.
IBD readers should focus on stocks whose RS lines are hitting new highs during a stock's base formation or on the actual breakout. These stocks get institutional support during weak and strong market environments.
Another positive signal is that the current base formation is an early-stage base. Early-stage bases are more likely to net bigger gains than later-stage formations.
The IBD Stock Checkup shows that HealthEquity stock boasts a near-perfect 98 IBD Composite Rating, another bullish attribute.
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Three recent IBD 50 Growth Stocks To Watch picks are among the best stocks to buy and watch.
| Company | Symbol | Buy point | Type of base |
|---|---|---|---|
| Insulet | (PODD) | 262.60 | 10-Week Line |
| Globus Medical | (GMED) | 87.22 | Flat base |
| Argan | (AGX) | 165.33 | Cup base |
Follow Scott Lehtonen on X at @IBD_SLehtonen for more on the best stocks to buy and watch and the Dow Jones Industrial Average.
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