Our top scoring large cap stocks from 1 year ago produced an average 287 bps of excess return to the S&P 500 over the past year. The best performers from a year ago (5/28/2013) are EOG up 59%, MGA up 59%, WFT up 50%, EA up 50%, HAL up 49%, and NOC up 49%.

• The top scoring large cap sector is utilities.
• The best scoring large cap industry is drug stores.

The average large cap score is 60.74, above the four week moving average score of 58.93. The average large cap is trading -9.5% below its 52 week high, 3.27% above its 200 dma, has 3.87 days to cover short, and is expected to post EPS growth of 13.34% next year.
 
Utilities, healthcare, and industrial goods score best across large cap. Basic materials and consumer goods score in line. Services, technology, and financials score below average.

The top large cap industry is drug stores (OCR, CVS, RAD). Drug store margin is supported by the patent calendar given that $34 billion will lose exclusivity this year and $66 billion will go off-patent in 2015. Railroad (CSX, UNP, NSC, KSU) carload volume is up 4% year-over-year in 2014 thanks to rebounding grain and coal shipments and ongoing strength in petroleum shipments. Pipeline (SE, WMB) throughput continues to benefit from capacity additions tied to rising shale production. Natural gas rigs have begun climbing again as prices have stabilized ahead of summer cooling natural gas utility demand. Interest in cigarette companies (LO, RAI, MO) is climbing in line with seasonal portfolio de-risking into summer. Semi ICs (TSM, MRVL) are strong scoring; however, investors should keep in mind that, historically, the SEMI book to bill peaks in the second quarter.

In large cap basics, buy pipelines, major chemicals (EMN, ASH, SHW), and major oil & gas (BP, XOM, COP). In consumer goods, focus on cigarettes, auto parts (TRW, MGA, ALV, BWA), and beverages (STZ, BF.B, DPS). Auto parts sales and profit growth should head higher thanks to rebounding commercial and passenger car registrations in Europe. EU passenger vehicle registrations are up 7.4% year-over-year in 2014.

In financials, concentrate on REITs (AVB, SLG, ESS, CPT, VNO), credit services (SLM, MCO, COF), and P&C insurers (AIG, WRB, XL, TRV). P&C insurers tend to head higher through hurricane season as storm season typically provide rate price power. In healthcare, buy healthcare plans (HUM, CI), drugmakers (ABBV, MRK, JNJ, LLY, ENDP, ALXN), and medical appliances (EW, RMD). Across industrial goods, buy diversified machinery (DOV, CMI), aerospace/defense (TDG, GD, BA), and industrial equipment (ROP, PNR). Aerospace tends to head higher into the summer air show order season. The best services industries include drug stores, rails, and diversified entertainment (TWX, DIS). Discretionary stocks tend to underperform through summer. In technology, buy semi ICs, diversified communication (AMT), and domestic telecom (CTL). All utilities (NEE, EIX, PPL, ETR, SCG, PEG) baskets score above average this week.