Weekly Investment Report
The best sector is industrial goods.
Industrial goods remain the top scoring sector across our 1500 company universe. Industrials goods have held the top spot in our sector ranking since October.
Healthcare, services, and consumer goods also score above average. Financials and technology score in line. In healthcare focus on large and mid cap. Buy large and small cap services rather than mid cap services. Focus on mid and small cap consumer stocks instead of large cap consumer stocks.
Basics and utilities score below average.
Industrial Goods
Over the 3 month period ending November, U.K. industrial production climbed 2.8% year-over-year -- the best rate of growth since May 2011. Production in both France and Spain grew in November. Production improved 1.3% in November from October in France and grew a seasonally adjusted, annualized 2.6% in Spain. In Germany, where production had been sliding, production returned to growth, finishing 3.5% above last year in November. Despite the rate of change dipping month-over-month in December, the UK's services sector grew in every month during 2013. On January 7th, the IMF's Christine Lagarde indicated the agency will likely boost global GDP forecasts for 2013. Currently, expectations call for 2.9% year-over-year growth. Potential for an improving Europe remains under-modeled in industrials. In addition to the ongoing strength in aerospace/defense (BA, CW, TDG), machinery (MIDD, ITT) and equipment (LFUS, BDC, SNHY) offer upside. Residential housing (LEN, NVR) is also re-exerting after consolidating late last year. Watch for expansion in commercial construction activity to drive results for related machinery, including cranes (TEX, MTW).
Healthcare
Despite fears regarding the implementation of the medical device tax, managers are turning back to appliances, devices, and instruments -- they're among the best scoring early in 2013 (STJ, STJ, BDX). Increase your exposure to generic drug makers (MYL, ACT) as the breather in the patent cliff last year ends and expiration re-exerts. High profile drugs, including Lilly's blockbuster Cymbalta and Teva's blockbuster Copaxone, provide an opportunity for upside.
Services
Services strength remains mixed with our best list including truckers, rails, apparel, restaurants, and lodging. The number of trucking jobs increased 1.8% in December compared to last year as the amount of freight hauled by for-hire truckers climbed 1.2% to a record high in November from October. The U.S. DOT's Freight Transportation Services index is 22.8% higher than the April 2009 low. Despite lackluster coal and grain carloads, U.S. rail volume held steady, improving 0.2% from 2012, thanks to record intermodal volume. Watch for carload pricing power this year, particularly if coal moves higher (thanks in part to easy comparisons) and grain continues higher (thanks to a return of export demand). Macy's positive 4.3% same-store sales gain in November and December adds some support for apparel and accessories (ANN, KORS) -- however, the industry remains bar-belled. Occupancy at U.S. hotels increased 4.5%, rates grew 6.5% and RevPAR was up 11.3% year-over-year in the first week of January.
Consumer Goods
Auto parts (BWA, FDML) and textiles (PVH, SKX, COLM, HBI) continue to dominate leadership across consumer goods. Recovering demand in Europe offers support for parts demand and profit leverage given regional cost cutting over the past three years. Cotton prices remain favorable for textile profitability as retail inventory turns support unit growth.
Economic Data to Watch this Week:
January 14th | January 15th |
Retail Sales Business Inventories |
Producer Prices PPI Inflation |
Top Scoring Stocks:
LG CAP | 1/7/2014 | 4 Week MA | MID CAP | 1/9/2014 | 4 Week MA | ||
Symbol | Sector | SCORE | SCORE | Symbol | Sector | SCORE | SCORE |
BEST | BEST | ||||||
AZO | SERVICES | 110 | 110 | VRSN | TECHNOLOGY | 110 | 108.75 |
JPM | FINANCIALS | 110 | 105 | CNO | FINANCIALS | 105 | 100 |
MCHP | TECHNOLOGY | 110 | 102.5 | HAS | CONSUMER GOODS | 105 | 103.75 |
AGN | HEALTHCARE | 105 | 100 | HTLD | SERVICES | 105 | 100 |
AMP | FINANCIALS | 105 | 107.5 | IRF | TECHNOLOGY | 105 | 103.75 |
BA | INDUSTRIAL GOODS | 105 | 102.5 | OCR | SERVICES | 105 | 108.75 |
CELG | HEALTHCARE | 105 | 103.75 | PVH | CONSUMER GOODS | 105 | 98.75 |
DIS | SERVICES | 105 | 107.5 | ACT | HEALTHCARE | 100 | 93.75 |
GLW | TECHNOLOGY | 105 | 103.75 | DDS | SERVICES | 100 | 102.5 |
MJN | CONSUMER GOODS | 105 | 98.75 | JKHY | TECHNOLOGY | 100 | 93.75 |
MYL | HEALTHCARE | 105 | 103.75 | SKX | CONSUMER GOODS | 100 | 90 |
SIAL | HEALTHCARE | 105 | 108.75 | TSCO | SERVICES | 100 | 100 |
APH | TECHNOLOGY | 100 | 102.5 | TTC | INDUSTRIAL GOODS | 100 | 100 |
ATVI | TECHNOLOGY | 100 | 87.5 | ALXN | HEALTHCARE | 95 | 97.5 |
BDX | HEALTHCARE | 100 | 96.25 | ARRS | TECHNOLOGY | 95 | 98.75 |
CSX | SERVICES | 100 | 102.5 | BRCD | TECHNOLOGY | 95 | 86.25 |
H | SERVICES | 100 | 98.75 | BWA | CONSUMER GOODS | 95 | 97.5 |
ITT | INDUSTRIAL GOODS | 100 | 100 | CAKE | SERVICES | 95 | 96.25 |
KORS | SERVICES | 100 | 91.25 | CHH | SERVICES | 95 | 97.5 |
MON | BASIC MATERIALS | 100 | 98.75 | CLB | BASIC MATERIALS | 95 | 92.5 |
NVDA | TECHNOLOGY | 100 | 86.25 | CMC | BASIC MATERIALS | 95 | 96.25 |
OI | CONSUMER GOODS | 100 | 103.75 | COLM | CONSUMER GOODS | 95 | 95 |
PRGO | HEALTHCARE | 100 | 93.75 | CRS | BASIC MATERIALS | 95 | 96.25 |
STJ | HEALTHCARE | 100 | 93.75 | CSL | CONSUMER GOODS | 95 | 97.5 |
TAP | CONSUMER GOODS | 100 | 102.5 | CW | INDUSTRIAL GOODS | 95 | 98.75 |
TMO | CONGLOMERATES | 100 | 95 | ESI | SERVICES | 95 | 85 |
V | SERVICES | 100 | 96.25 | FDML | CONSUMER GOODS | 95 | 90 |
AAPL | TECHNOLOGY | 95 | 96.25 | FL | SERVICES | 95 | 90 |
AON | FINANCIALS | 95 | 97.5 | HBI | CONSUMER GOODS | 95 | 88.75 |
BCR | HEALTHCARE | 95 | 92.5 | HP | BASIC MATERIALS | 95 | 98.75 |
BEN | FINANCIALS | 95 | 93.75 | HRL | CONSUMER GOODS | 95 | 91.25 |
CF | BASIC MATERIALS | 95 | 97.5 | ILMN | HEALTHCARE | 95 | 98.75 |
DG | SERVICES | 95 | 96.25 | LEN | INDUSTRIAL GOODS | 95 | 95 |
DISH | CONSUMER GOODS | 95 | 90 | LSI | TECHNOLOGY | 95 | 91.25 |
ESRX | SERVICES | 95 | 91.25 | MTW | INDUSTRIAL GOODS | 95 | 97.5 |
FLR | INDUSTRIAL GOODS | 95 | 93.75 | NTES | TECHNOLOGY | 95 | 91.25 |
GS | FINANCIALS | 95 | 90 | NVR | INDUSTRIAL GOODS | 95 | 91.25 |
JEC | SERVICES | 95 | 75 | OTEX | TECHNOLOGY | 95 | 98.75 |
LEA | CONSUMER GOODS | 95 | 93.75 | PII | CONSUMER GOODS | 95 | 96.25 |
LNC | FINANCIALS | 95 | 96.25 | QLGC | TECHNOLOGY | 95 | 77.5 |
LO | CONSUMER GOODS | 95 | 97.5 | SF | FINANCIALS | 95 | 98.75 |
MCO | FINANCIALS | 95 | 98.75 | TDG | INDUSTRIAL GOODS | 95 | 95 |
NOC | INDUSTRIAL GOODS | 95 | 93.75 | TEX | INDUSTRIAL GOODS | 95 | 98.75 |
NUE | BASIC MATERIALS | 95 | 97.5 | TPX | CONSUMER GOODS | 95 | 93.75 |
NWL | CONSUMER GOODS | 95 | 98.75 | TQNT | TECHNOLOGY | 95 | 88.75 |
TROW | FINANCIALS | 95 | 92.5 | TUP | CONSUMER GOODS | 95 | 96.25 |
VLO | BASIC MATERIALS | 95 | 91.25 | UHS | HEALTHCARE | 95 | 87.5 |
WCRX | HEALTHCARE | 95 | 91.25 | WWW | CONSUMER GOODS | 95 | 97.5 |
WY | INDUSTRIAL GOODS | 95 | 98.75 | ||||
X | INDUSTRIAL GOODS | 95 | 95 | ||||
YUM | SERVICES | 95 | 75 | ||||
ZMH | HEALTHCARE | 95 | 88.75 | ||||
SMALL CAP | 1/9/2014 | 4 Week MA | ADRS | 1/6/2014 | 4 Week MA | ||
Symbol | Sector | SCORE | SCORE | Symbol | COUNTRY | SCORE | SCORE |
BEST | BEST | ||||||
AGYS | SERVICES | 105 | 98.75 | INFY | India | 100 | 95.00 |
HGR | HEALTHCARE | 105 | 96.25 | PSDV | United States | 100 | 68.75 |
AFFX | TECHNOLOGY | 100 | 92.5 | ARMH | United Kingdom | 95 | 93.75 |
ANN | SERVICES | 100 | 85 | MPEL | Hong Kong | 95 | 86.25 |
BLDR | SERVICES | 100 | 90 | NTES | China | 95 | 82.50 |
CCC | INDUSTRIAL GOODS | 100 | 96.25 | SIG | Bermuda | 95 | 93.75 |
CENX | BASIC MATERIALS | 100 | 96.25 | BIDU | China | 90 | 73.75 |
CFNL | FINANCIALS | 100 | 91.25 | BRGYY | United Kingdom | 90 | 86.25 |
DPZ | SERVICES | 100 | 97.5 | GA | China | 90 | 85.00 |
GBX | SERVICES | 100 | 96.25 | GENT | Italy | 90 | 76.25 |
HZO | SERVICES | 100 | 95 | GSOL | Bermuda | 90 | 67.50 |
LFUS | INDUSTRIAL GOODS | 100 | 93.75 | GMK | México | 85 | 77.50 |
MDSO | TECHNOLOGY | 100 | 92.5 | HIMX | Taiwan | 85 | 70.00 |
MIDD | INDUSTRIAL GOODS | 100 | 96.25 | JOBS | China | 85 | 88.75 |
MOH | HEALTHCARE | 100 | 75 | JST | China | 85 | 85.00 |
OPEN | TECHNOLOGY | 100 | 97.5 | NJ | Japan | 85 | 80.00 |
SABA | TECHNOLOGY | 100 | 93.75 | RIO | United Kingdom | 85 | 87.50 |
TRAK | TECHNOLOGY | 100 | 93.75 | SAP | Germany | 85 | 80.00 |
UHAL | SERVICES | 100 | 98.75 | SI | Germany | 85 | 81.25 |
WIRE | BASIC MATERIALS | 100 | 100 | SORL | China | 85 | 62.50 |
WTFC | FINANCIALS | 100 | 96.25 | SPRD | China | 85 | 77.50 |
ALGN | HEALTHCARE | 95 | 85 | TRIB | Ireland | 85 | 82.50 |
ANAC | HEALTHCARE | 95 | 97.5 | VLCCF | Bermuda | 85 | 63.75 |
BCOR | TECHNOLOGY | 95 | 97.5 | WF | Korea | 85 | 70.00 |
BDC | INDUSTRIAL GOODS | 95 | 97.5 | ABB | Switzerland | 80 | 75.00 |
BONT | SERVICES | 95 | 92.5 | BMO | Canada | 80 | 70.00 |
CBRL | SERVICES | 95 | 90 | CAAS | China | 80 | 63.75 |
COHR | TECHNOLOGY | 95 | 90 | CPA | Panama | 80 | 77.50 |
CWT | UTILITIES | 95 | 86.25 | ELN | Ireland | 80 | 63.75 |
DXYN | CONSUMER GOODS | 95 | 86.25 | HKTV | Hong Kong | 80 | 68.75 |
FFIN | FINANCIALS | 95 | 97.5 | JRJC | China | 80 | 63.75 |
FINL | SERVICES | 95 | 91.25 | NTZ | Italy | 80 | 63.75 |
HUBG | SERVICES | 95 | 87.5 | NVO | Denmark | 80 | 80.00 |
IVAC | TECHNOLOGY | 95 | 88.75 | RUK | United Kingdom | 80 | 75.00 |
LCAV | HEALTHCARE | 95 | 76.25 | SID | Brazil | 80 | 82.50 |
NWBI | FINANCIALS | 95 | 93.75 | SNN | United Kingdom | 80 | 82.50 |
PLXT | TECHNOLOGY | 95 | 90 | WIT | India | 80 | 81.25 |
PRCP | TECHNOLOGY | 95 | 83.75 | ||||
RAD | SERVICES | 95 | 87.5 | ||||
RGR | CONSUMER GOODS | 95 | 87.5 | ||||
SILC | TECHNOLOGY | 95 | 93.75 | ||||
SNHY | INDUSTRIAL GOODS | 95 | 93.75 | ||||
SSNC | TECHNOLOGY | 95 | 93.75 | ||||
STFC | FINANCIALS | 95 | 80 |
None.