Consumer Services: 10 Top Attractive and Unattractive Companies in Russell 2000

Below is a chart outlining the 2009 year-to-date performance of the sectors within the Russell 2000 (based on the sector classification of The Applied Finance Group). The Consumer Services sector has led the way thus far, while Utilities and Financials have dragged down the overall performance of the index.

Since Consumer Services has led the pack in 2009, we thought it would be helpful to provide a list of 10 companies within the sector, 5 of which still look like they have room to run while the other 5 now look overvalued. The 5 attractive companies are expected to improve their Economic Margins [EM] better than their sector peers this year and look attractive based on AFG's valuation model. The 5 unattractive companies are expected to produce a change in EM worse that their sector peers and look overvalued based on AFG’s valuation model.

Attractive and Unattractive Consumer Services Companies - Russell 2000

Related Article: S&P 500 YTD Returns 2009

AFG's Buy/Sell Criteria - factors in Economic Margin, Management Quality, and AFG's Valuation Metric. In order to determine Management Quality, AFG scores management on their growth decisions in accordance with the company’s ability to either create or destroy wealth. AFG's Valuation Metric measures a company's Percent to Target (the deviation between a stock's current trading price and its AFG current default target price). To derive the intrinsic value of a firm, AFG uses its proprietary Valuation Model.

AFG's Valuation Metric – Measures the percent to target (deviation between a stock’s current trading price and its AFG current default target price). To derive the intrinsic value of a firm, AFG uses its proprietary Valuation Model (modified discounted cash flow model).

Disclosure: No position