Are you looking for stocks that have demonstrated an ability to surpass both industry peers and overall market performance? You're in luck, because for this list, we capitalized on the concept of "momentum investing" to find rallying companies that have also proved themselves more profitable than their competitors -- all while receiving favorable attention from institutional investors.
Momentum investing
Technical analysis -- which mostly focuses on past price and volume data -- is very different from the traditional methods of fundamental stock analysis, but it can offer an interesting perspective of where stocks are and where they may be going.
One of the most popular technical indicators is momentum -- the idea that recent trading trends for a stock may persist as more investors follow suit. For instance, a stock that is trading above its 20-day, 50-day, and 200-day moving averages (MA) is clearly surrounded by positive investor sentiment, and that idea may resound with investors for some time to come.
Additional screening
To increase the quality of our list, we ran an additional screen for those that have beaten out their competitors, based on gross, operating, and pre-tax profit margins over the last 12 months. Here's a quick breakdown of what that means:
- TTM Gross margin: This metric tells us the percentage of a company's revenue that's left after paying the costs for production of inventory.
- TTM Operating margin: This tells us the percentage remaining after all operating expenses are paid. Operating expenses include: supplies, repairs, research and development, and depreciation.
- TTM Pre-tax margin: A company's earnings before taxes. This incorporates all of the expenses associated with business excluding taxes.
The list
We screened these highly profitable stocks on a rally for those with the highest net buying from institutional investors over the current quarter. Instituti! ons incl ude mutual funds, hedge funds, pensions, bank trust departments, and they often have access to more sophisticated research than the average investor.
If institutional investors start investing in a company, other investors can assume that some of the most talented analysts and money managers expect the company's share prices to increase over time.
The "smart money" thinks these profitable stocks have the momentum to push even higher -- do you?
List sorted by institutional buying. (Click here to access free, interactive tools to analyze these ideas.)
1. First Republic Bank (NYSE: FRC ) : Provides private banking, private business banking, investment management, brokerage, trust services, and real estate lending services in California, Nevada, and New York. Market cap of $3.74B. Net institutional shares purchased over the current quarter at 20.2M, which is 37.57% of the company's 53.77M share float. TTM gross margin at 86.99% vs. industry gross margin at 71.27%. TTM operating margin at 60.41% vs. industry operating margin at 39.33%. TTM pre-tax margin at 42.67% vs. industry pre-tax margin at 22.51%. The stock is currently trading 2.73% above its 20-day MA, 8.8% above its 50-day MA, and 1.54% above its 200-day MA.
2. IPC The Hospitalist Company (Nasdaq: IPCM ) : Provides hospitalist services in the United States. Market cap of $779.91M. Net institutional shares purchased over the current quarter at 1.6M, which is 10.03% of the company's 15.95M share float. TTM gross margin at 27.29% vs. industry gross margin at 21%. TTM operating margin at 10.46% vs. industry operating margin at 8.47%. TTM pre-tax margin at 10.28% vs. industry pre-tax margin at 6.80%. The stock is currently trading 7.64% above its 20-day MA, 14.94% above its 50-day MA, and 7.7% above its 200-day MA.
3. Hexcel (NYSE: HXL ) : Engages in th! e develo pment, manufacture, and marketing of composites for use in the commercial aerospace, space and defense, and industrial applications. Market cap of $2.41B. Net institutional shares purchased over the current quarter at 8.5M, which is 8.72% of the company's 97.51M share float. TTM gross margin at 28.16% vs. industry gross margin at 25.81%. TTM operating margin at 12.45% vs. industry operating margin at 12.05%. TTM pre-tax margin at 11.60% vs. industry pre-tax margin at 7.26%. The stock is currently trading 2.03% above its 20-day MA, 3.32% above its 50-day MA, and 14.58% above its 200-day MA.
4. Saul Centers (NYSE: BFS ) : Operates as a real estate investment trust in the United States. Market cap of $669.98M. Net institutional shares purchased over the current quarter at 577.2K, which is 7.22% of the company's 7.99M share float. TTM gross margin at 43.60% vs. industry gross margin at 38.85%. TTM operating margin at 43.60% vs. industry operating margin at 38.06%. TTM pre-tax margin at 18.11% vs. industry pre-tax margin at 15.70%. The stock is currently trading 2.65% above its 20-day MA, 0.72% above its 50-day MA, and 0.72% above its 200-day MA.
5. Select Comfort (Nasdaq: SCSS ) : Develops, manufactures, markets, and supports adjustable-firmness beds and other sleep-related accessory products in the U. Market cap of $1.16B. Net institutional shares purchased over the current quarter at 3.5M, which is 6.94% of the company's 50.46M share float. TTM gross margin at 65.20% vs. industry gross margin at 37.95%. TTM operating margin at 11.66% vs. industry operating margin at 10.07%. TTM pre-tax margin at 11.65% vs. industry pre-tax margin at 9.33%. The stock is currently trading 4.32% above its 20-day MA, 12.42% above its 50-day MA, and 30.88% above its 200-day MA.
6. BE Aerospace (Nasdaq: BEAV ) : Engages in the design, manufact! ure, sal e, and service of commercial aircraft and business jet cabin interior products worldwide. Market cap of $4.01B. Net institutional shares purchased over the current quarter at 6.3M, which is 6.57% of the company's 95.89M share float. TTM gross margin at 39.76% vs. industry gross margin at 25.79%. TTM operating margin at 17.17% vs. industry operating margin at 12.04%. TTM pre-tax margin at 11.83% vs. industry pre-tax margin at 7.08%. The stock is currently trading 2.57% above its 20-day MA, 7.79% above its 50-day MA, and 7.45% above its 200-day MA.
7. Astronics (Nasdaq: ATRO ) : Designs and manufactures products for the aerospace and defense industries worldwide. Market cap of $446.52M. Net institutional shares purchased over the current quarter at 598.9K, which is 6.09% of the company's 9.84M share float. TTM gross margin at 27.60% vs. industry gross margin at 25.81%. TTM operating margin at 13.58% vs. industry operating margin at 12.05%. TTM pre-tax margin at 12.65% vs. industry pre-tax margin at 7.26%. The stock is currently trading 9.86% above its 20-day MA, 15.25% above its 50-day MA, and 31.09% above its 200-day MA.
8. Dril-Quip (NYSE: DRQ ) : Designs, manufactures, fabricates, inspects, assembles, tests, and markets engineered offshore drilling and production equipment for use in deepwater, harsh environment, and severe service applications worldwide. Market cap of $2.95B. Net institutional shares purchased over the current quarter at 1.9M, which is 5.50% of the company's 34.54M share float. TTM gross margin at 44.36% vs. industry gross margin at 34.56%. TTM operating margin at 22.52% vs. industry operating margin at 17.99%. TTM pre-tax margin at 21.03% vs. industry pre-tax margin at 16.08%. The stock is currently trading 10.73% above its 20-day MA, 17.2% above its 50-day MA, and 9.18% above its 200-day MA.
9. Federal Realty Investment Trust (NYSE: FRT ) : Operates as a real estate investment trust, which engages in the ownership, management, development, and redevelopment of retail and mixed-use properties. Market cap of $5.65B. Net institutional shares purchased over the current quarter at 2.8M, which is 4.45% of the company's 62.89M share float. TTM gross margin at 41.94% vs. industry gross margin at 38.85%. TTM operating margin at 41.94% vs. industry operating margin at 38.06%. TTM pre-tax margin at 24.26% vs. industry pre-tax margin at 15.70%. The stock is currently trading 2.48% above its 20-day MA, 4.09% above its 50-day MA, and 5.68% above its 200-day MA.
10. DuPont Fabros Technology (NYSE: DFT ) : Engages in the ownership, acquisition, development, operation, management, and lease of large-scale data center facilities in the United States. Market cap of $1.50B. Net institutional shares purchased over the current quarter at 2.2M, which is 3.60% of the company's 61.06M share float. TTM gross margin at 69.74% vs. industry gross margin at 38.73%. TTM operating margin at 38.25% vs. industry operating margin at 37.94%. TTM pre-tax margin at 27.54% vs. industry pre-tax margin at 15.58%. The stock is currently trading 7.12% above its 20-day MA, 12.25% above its 50-day MA, and 3.76% above its 200-day MA.
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Kapitall's Rebecca Lipman does not own any of the shares mentioned above. Institutional and profitability data sourced from Fidelity, all other data sou! rced fro m Finviz.
No comments:
Post a Comment