Here is a simple screen based on S&P analysis. It consists of the top 3 stocks (if any) in each of 10 sectors that pass these criteria:
- year ahead expected relative market performance above average (4 or 5 of 5)
- price versus current fair value undervalued (4 or 5 of 5)
- PEG ratio <= 2 and >= 0.5
- yield > 0
- ThompsonReuters StarMine year ahead expectations not negative
- stocks ranked by PEG from lowest to highest
- if there is a tie in the PEG ratio, the higher yielding stock is selected
- if less than 3 stocks meet criteria for a sectors only those meeting criteria are selected.
As of November 7, there are 21 stocks that meet the criteria:
| Celanese Corporation | CE |
| Comcast Corp Class A | CMCSA |
| PetSmart Inc. | PETM |
| Whirlpool Corporation | WHR |
| CVS Caremark Corp | CVS |
| Wal-Mart Stores Inc | WMT |
| Chevron Corp | CVX |
| National Oilwell Varco, Inc. | NOV |
| Bank of Montreal | BMO |
| Bank of Nova Scotia | BNS |
| Franklin Resources Inc. | BEN |
| Aetna Inc | AET |
| Humana | HUM |
| WellPoint Inc | WLP |
| Norfolk Southern Corporation | NSC |
| PACCAR Inc | PCAR |
| Trinity Industries, Inc. | TRN |
| Apple Inc | AAPL |
| International Business Machines | IBM |
| International Paper Co. | IP |
| Qualcomm, Inc. | QCOM |
This table contains the current yield, 1-year earnings growth rate and price-to-cash flow for the screen selected companies.
(click image to enlarge)
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