Methodology

Our weekly best and worst reports show you stocks with the best potential returns over the coming 6 to 12 months.  The score is calculated by fusing together the key drivers of price movement including, earnings beats, earnings growth, at-the-market insider buys, institutional activity, short ratio analysis, price to earnings analysis and calendar quarter seasonality.  Those stocks appearing in our best list should be bought while those appearing in our worst list should be sold.

The highest scoring names in mid cap from 1 year ago (4/17/2013) returned 615 bps more than the S&P 500.  The best performers have been ILMN up 134%, UA up 79%, GMCR up 78%, TRN up 71%, and SIVB up 67%.

• The best mid cap sector is utilities.
• The top scoring mid cap industry is gas utilities

The average mid cap score is 50.97, below the four week moving average score of 52.3. The average mid cap is trading -15.97% below its 52 week high, -0.28% below its 200 dma, has 6.55 days to cover short, and is expected to grow EPS by 19% next year.
 
The best sector is utilities. Basics and consumer goods also score above average.  Industrial goods, healthcare, and technology score in line. Financials and services score below average.
 
 

Gas utilities (PNY, NJR) score best across the mid cap universe. Oil & gas equipment & services (PDS, RES, EXH) score high. Truckers (HTLD, KNX) offer upside as volume grows and prices firm. Industrial metals & minerals (ARLP) benefit as coal electricity production is supported by higher natural gas prices.

The best groups in basics are oil & gas equipment & services, industrial metals & minerals, and specialty chemicals (NEU). In consumer, focus on processed & packaged goods (FLO, GIS), textiles (COLM, CRI), and business equipment (DBD). In financials, buy accident & health insurance (AIZ) and REITs (TCO, DEI, KRC). Vacancy rates continue to improve relative to peaks, supporting effective rents. Apartment vacancies fell 20 bps to 4.0% in Q1 versus Q4. Effective rents grew 0.6% in the quarter, according to REIS. In healthcare, only medical instruments (TFX, NUVA, PKI, PODD) score above average. Across industrial goods, the best scoring industries are aerospace/defense (ATK, ESL, CAE) and industrial electrical equipment (LFUS). The top services groups are trucking and rental & leasing (R,AER, UHAL). In technology, buy computer peripherals (NICE, AUO), semi equipment (SPIL), and printed circuits (FLEX).