Seeking Alpha
Value, growth, long-term horizon, medium-term horizon
Profile| Send Message|
( followers)  

The following is a list of breakout stocks, based on moving average trends. For this article, we define an inflection point as the convergence between the 50-day and 200-day moving averages.

When these two moving averages cross, it often represents a shift in investor sentiment. If the 50-day MA moves above the 200-day MA (bullish), it's called a "Golden Cross" signal. If, on the other hand, the 50-day MA crosses below the 200-day MA (bearish), it's called the "Death Cross."

All of the stocks mentioned below have recently seen the SMA50 move above the SMA200 (bullish signal). In addition, all of these stocks have a track record of beating analyst earnings estimates.

Judging by their earnings results relative to analyst estimates, it's clear that these stocks are being underestimated by analysts.

Now that these companies are seeing upward momentum, will their winning streak continue, or is most of the good news already priced in?

We last wrote about this screen on November 16, 2010. On that day, the screen produced 25 companies. Since then, 17 out of 25 companies mentioned in that article have outperformed the S&P 500 index (a success rate of 68.00%). The screen averaged a return of 12.51% vs. an index return of 7.91%. Click here to access a full breakdown of the screen's past performance.

A full breakdown of earnings relative to analyst estimates can be accessed here.

(Earnings data sourced from AOL Money, short float data sourced from Finviz.)

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research. Note: The numbers on top of items represent the forward P/E ratio, if available.



The list has been sorted by average surprise over the last year.

1. Nexen Inc. (NXY): Independent Oil & Gas Industry. Market cap of $11.5B. Over the last year, the company beat analyst earnings estimates by an average of 67.08%. SMA50 at $21.72 vs. SMA200 at $21.51 (current price at $22.93). Short float at 0.36%, which implies a short ratio of 0.9 days. The stock has lost -8.36% over the last year.

2. Och-Ziff Capital Management Group LLC (OZM): Asset Management Industry. Market cap of $5.72B. Over the last year, the company beat analyst earnings estimates by an average of 60.27%. SMA50 at $14.79 vs. SMA200 at $14.68 (current price at $15.6). Short float at 4.74%, which implies a short ratio of 7.53 days. The stock has gained 11.7% over the last year.

3. IberiaBank Corp. (IBKC): Regional Bank. Market cap of $1.55B. Over the last year, the company beat analyst earnings estimates by an average of 60.05%. SMA50 at $54.92 vs. SMA200 at $53.89 (current price at $57.7). Short float at 8.78%, which implies a short ratio of 16.97 days. The stock has gained 9.22% over the last year.

4. Nucor Corporation (NUE): Steel & Iron Industry. Market cap of $13.81B. Over the last year, the company beat analyst earnings estimates by an average of 48.55%. SMA50 at $40.91 vs. SMA200 at $40.45 (current price at $44.6). Short float at 4.48%, which implies a short ratio of 3.5 days. The stock has lost -8.78% over the last year.

5. Chico's FAS Inc. (CHS): Apparel Stores Industry. Market cap of $1.99B. Over the last year, the company beat analyst earnings estimates by an average of 43.01%. SMA50 at $11.46 vs. SMA200 at $11.27 (current price at $10.7). Short float at 5.35%, which implies a short ratio of 2.36 days. The stock has lost -20.71% over the last year.

6. Kulicke & Soffa Industries Inc. (KLIC): Semiconductor Equipment & Materials Industry. Market cap of $651.69M. Over the last year, the company beat analyst earnings estimates by an average of 41.63%. SMA50 at $6.96 vs. SMA200 at $6.92 (current price at $9.23). Short float at 6.2%, which implies a short ratio of 2.41 days. The stock has gained 54.29% over the last year.

7. Accuray Incorporated (ARAY): Medical Appliances & Equipment Industry. Market cap of $406.23M. Over the last year, the company beat analyst earnings estimates by an average of 41.07%. SMA50 at $6.44 vs. SMA200 at $6.39 (current price at $6.98). Short float at 3.45%, which implies a short ratio of 6.6 days. The stock has gained 1.92% over the last year.

8. Tenet Healthcare Corp. (THC): Hospitals Industry. Market cap of $3.32B. Over the last year, the company beat analyst earnings estimates by an average of 39.2%. SMA50 at $5.36 vs. SMA200 at $4.99 (current price at $6.88). Short float at 2.43%, which implies a short ratio of 1.02 days. The stock has gained 9.44% over the last year.

9. United Microelectronics Corporation (UMC): Semiconductor Equipment & Materials Industry. Market cap of $8.18B. Over the last year, the company beat analyst earnings estimates by an average of 38.52%. SMA50 at $3.09 vs. SMA200 at $3.07 (current price at $3.24). Short float at 0.25%, which implies a short ratio of 2.3 days. The stock has lost -22.79% over the last year.

10. Eagle Materials Inc. (EXP): Cement Industry. Market cap of $1.22B. Over the last year, the company beat analyst earnings estimates by an average of 37.57%. SMA50 at $26.6 vs. SMA200 at $26.16 (current price at $27.91). Short float at 10.99%, which implies a short ratio of 12.76 days. The stock has gained 13.64% over the last year.

11. JPMorgan Chase & Co. (JPM): Money Center Banks Industry. Market cap of $169.66B. Over the last year, the company beat analyst earnings estimates by an average of 34.25%. SMA50 at $40.33 vs. SMA200 at $39.97 (current price at $43.79). Short float at 1%, which implies a short ratio of 1.03 days. The stock has lost -2.05% over the last year.

12. Drew Industries Inc. (DW): Recreational Vehicles Industry. Market cap of $496.74M. Over the last year, the company beat analyst earnings estimates by an average of 23.75%. SMA50 at $21.71 vs. SMA200 at $21.5 (current price at $22.87). Short float at 3.24%, which implies a short ratio of 8.89 days. The stock has gained 6.45% over the last year.

13. Investors Bancorp Inc. (ISBC): Savings & Loans Industry. Market cap of $1.56B. Over the last year, the company beat analyst earnings estimates by an average of 21.57%. SMA50 at $12.77 vs. SMA200 at $12.75 (current price at $13.66). Short float at 3.25%, which implies a short ratio of 9.59 days. The stock has gained 25.02% over the last year.

14. Hawaiian Electric Industries Inc. (HE): Electric Utilities Industry. Market cap of $2.3B. Over the last year, the company beat analyst earnings estimates by an average of 20.79%. SMA50 at $22.57 vs. SMA200 at $22.53 (current price at $24.59). Short float at 3.51%, which implies a short ratio of 5.69 days. The stock has gained 20.48% over the last year.

15. Chemical Financial Corp. (CHFC): Regional Bank. Market cap of $603.95M. Over the last year, the company beat analyst earnings estimates by an average of 20.77%. SMA50 at $21.56 vs. SMA200 at $21.56 (current price at $22.23). Short float at 2.87%, which implies a short ratio of 16.42 days. The stock has gained 5.61% over the last year.

16. National Semiconductor Corporation (NSM): Semiconductor Industry. Market cap of $3.39B. Over the last year, the company beat analyst earnings estimates by an average of 18.32%. SMA50 at $13.73 vs. SMA200 at $13.61 (current price at $14.06). Short float at 6.56%, which implies a short ratio of 3.84 days. The stock has lost -4.03% over the last year.

17. J. Crew Group, Inc. (JCG): Apparel Stores Industry. Market cap of $2.82B. Over the last year, the company beat analyst earnings estimates by an average of 17.87%. SMA50 at $40.46 vs. SMA200 at $39.27 (current price at $44.01). Short float at 6.53%, which implies a short ratio of 1.19 days. The stock has lost -0.85% over the last year.

18. NVR Inc. (NVR): Residential Construction Industry. Market cap of $4.23B. Over the last year, the company beat analyst earnings estimates by an average of 17.32%. SMA50 at $660.83 vs. SMA200 at $660.43 (current price at $762.53). Short float at 6.72%, which implies a short ratio of 12.09 days. The stock has gained 5.64% over the last year.

19. Kaydon Corporation (KDN): Machine Tools & Accessories Industry. Market cap of $1.28B. Over the last year, the company beat analyst earnings estimates by an average of 17.19%. SMA50 at $37.4 vs. SMA200 at $36.45 (current price at $38.78). Short float at 3.51%, which implies a short ratio of 4.08 days. The stock has gained 2.54% over the last year.

20. Leggett & Platt, Incorporated (LEG): Home Furnishings & Fixtures Industry. Market cap of $3.34B. Over the last year, the company beat analyst earnings estimates by an average of 16.83%. SMA50 at $21.46 vs. SMA200 at $21.38 (current price at $22.95). Short float at 2.19%, which implies a short ratio of 1.99 days. The stock has gained 13.44% over the last year.

Source: Top 20 Underestimated Breakout Stocks