Below is a list of 10 small cap value earnings surprise stocks for the next 30 days. Last month's portfolio can be seen here. The Mid-April to Mid-May portfolio returned -6.64% versus -5.77% for SPY and -3.77% for VBR, a small-cap value ETF, while the Mid-May to Mid-June returned .14% versus -1.93% on SPY and -4.48% on VBR. Mid-June to Mid-July was a disappointing period - the list returned an average of -6.40% versus -3.97% for VBR and -1.56% for SPY. Returns exclude dividends, slippage, and commission.
My screen looks for a low PEG, recent earnings surprises, a minimum volume requirement, and small market capitalization. I exclude OTC stocks and I further narrow the list based on additional fundamental factors to 10 stocks or less. The list, as always, is not a specific portfolio but a recommendation for further research. Since this is a purely mechanical screen, I play no discretion in the results (other than establishing the original screen criteria). A couple of months ago I added a 200 day simple moving average requirement - stocks must be trading above their 200 day moving average in order to make the list. I use stockscreen123 as the screener.
The stocks on this list can be especially volatile given their low market capitalization, so please do proper due diligence. I find the list useful for gathering potential investment or trade ideas rather than a blanket "buy" list. Another option is to abandon this type of screen entirely when the underlying index is trading below its long-term moving average (such as the 200 day). As of 7/15/10, the Russell 2000 was trading just below the 200 day moving average. The current lists of stocks are below and returns can be tracked real--time on the right hand side of Scott's Investments:
|FINL||The Finish Line, Inc.||Here||99.49||797||Retail (Apparel)|
|GIII||G-III Apparel Group, Ltd.||Here||99||448.07||Apparel/Accessories|
|NSIT||Insight Enterprises, Inc.||Here||98.87||642.54||Computer Hardware|
|MDF||Metropolitan Health Networks,||Here||98.58||152.07||Healthcare Facilities|
|SCLN||SciClone Pharmaceuticals, Inc||Here||98.18||165.23||Biotechnology & Drugs|
|MEAS||Measurement Specialties, Inc.||Here||96.92||225.57||Scientific & Technical Instr.|
|UTI||Universal Technical Institute||Here||95.97||558.06||Schools|
|STKL||SunOpta, Inc. (NYSE:USA)||Here||95.46||303.86||Food Processing|
|NC||NACCO Industries, Inc.||Here||93.27||754.09||Misc. Capital Goods|
|RELL||Richardson Electronics, Ltd.||Here||93.12||166.36||Electronic Instr. & Controls|
Disclosure: No positions
Source: 10 Small Cap Earnings Growers