E Weekly Report: The Stocks To Buy, The Stocks To Watch

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.

Top scoring weekly returns:  Buy and Hold 1 Year

 

• The best scoring sector remains industrial goods.  

The best scoring sector remains industrial goods. Healthcare also scores above average.
 
Financials, technology, and services score in line. In financials and technology, focus on mid cap.
 
Consumer goods, basic materials, and utilities score below average. In consumer goods, concentrate on mid cap. In utilities buy small cap.

The following chart visualizes score by sector and market cap.

The next chart shows the rolling four, eight, and 12 week moving average of our universe score since 2010.

 

The next table breaks out major market seasonality using ETFs as proxy.  The Nasdaq 100 and S&P 400 offer the best seasonal tailwinds for the 3-month period ending May 30th. S&P 500 seasonality shifts from bullish to neutral.
 

 The following companies offer the best seasonality across large, mid, and small cap for the next three months.

Industrial Goods
 

Industrials have strong seasonal tailwinds through May. In the past 10 years, the XLI has gained eight times, producing an average and median 6.17%, respectively.
 

Healthcare
 

Healthcare offers neutral seasonality during the next three months, posting gains in 6 of the past 10 years, and returning an average and median 3.16%, and 2.3%, respectively.