Throughout the year, we have been monitoring the stocks near the top of the rankings on the new Stock Score Report screener, and while we typically see a host of large cap stocks, this week we see a nice selection of mid-cap stocks occupying top spots in the rankings.
The Stock Score Report combines both technical and fundamental scoring systems to rank the overall stock universe. The approach has proven successful, and by using both investing approaches we have consistently found stocks that have not only shown recent strength in the market but managed to continue building on those gains.
This week’s group of stocks is a nicely diversified group of mid-cap stocks, with market caps ranging from around $2 billion to $6 billion.
Mid-cap stocks are favorable because they still have a lot of growth potential but have already proven an ability to grow to their current size which demonstrates management understands the underlying business, and has already managed to overcome the company’s original growing pains.
For investors looking to expand their mid-cap holdings, here are five stocks that look solid at this time.
Callaway Golf Company
Golf equipment and accessories maker Callaway Golf Co. (ELY) is a mid-cap stocks with a market cap of just over $2.2 billion. The stock has enjoyed steady gains through 2018, and shares are currently up around 70% on the year. ELY gets an overall score of 92 on the Stock Score Report, and with such strong gains during the year it is not surprising the stock has near-perfect scores for both short and long-term technical trends. The company is growing rapidly, with analysts expecting full year earnings growth of 90% and an average annual five-year growth rate of around 31% moving forward. ELY trades at $23.61 with an average price target of $24.22.
Strategic Education (STRA) is the educational company behind Strayer University and Capella University. The $2.9 billion market cap stock began a bullish ran in March and has moved higher steadily since. STRA is currently up 54% on the year, and the stock gets an overall score of 90 in the Stock Score Report, with near perfect technical scores and a very solid 75 fundamental ranking. The company posted better than expected earnings last quarter, while sales were slightly weaker than expected, and flat year over year. Wall Street focused on the earnings beat and pushed the stock to a new 52-week high on the results. Earnings are forecast to rise 37% for the current year, and by an additional 39% next year. STRA trades at $136.44 with an average price target of $138.75.
Mid-cap industrial products maker Crane Co (CR) shot to the upside over the summer, and with the recent gains the stock is currently up 12% on the year, but has risen around 25% since its July lows. CR has a $5.8 billion market cap. The company posted better than expected numbers on the top and bottom line last quarter, and earnings were up 20.5% versus the same period last year. Stock Score Report gives CR an overall score of 90, with both technical and fundamental scores showing strength. The stock’s valuation remains attractive with a forward P/E of 15.3 and earnings expected to grow 27% this year and an additional 12% in 2019. CR trades at $17.85 with a $20.00 average price target.
The financial sector has been strong in the face of rising interest rates, and regional bank First BanCorp (FBP) has been no exception. The stock has appreciated 76% on the year, and currently has a $1.9 billion market cap. Stock Score Report gives FBP an overall score of 89, with a very strong 95 short-term technical ranking. Regional banks will benefit from rising interest rates as they are able to widen the spread on funds they loan customers versus funds they borrow. Analysts expect the company to double its earnings during the current year, and by 35% per annum over the next five years. This growth could be greatly understated depending on how many additional rate hikes the Fed makes in the next couple of years. FBP trades at $9.02 with a $10.00 average price target.
Helen of Troy
Helen of Troy (HELE) makes consumer goods products. HELE is a mid-cap stock with a $3.4 billion market cap. The company is behind popular brands such as Pert, Revlon, Braun, and Honeywell. The stock has enjoyed steady gains since April, and shares are now up 12% year to date. The company posted much better than expected Q1 numbers in July, and it will next report quarterly numbers on October 9. Stock Score Report gives HELE an overall score of 90, with near-perfect scores on both short and long-term technical trends. Earnings are expected to rise 5.2% during the current year, and by an additional 5.1% next year. HELE trades at $130.75 with an average price target of $142.50.