Stock Market Beat's Small-, Mid- and Large-Cap Watch Lists, 3Q07

With the end of the first quarter approaching, it is time to adjust the names in my Watch Lists. I will price all the new lists as of the close on Friday, June 29.

Below I present my planned updates to the Small-Cap Watch List. There was a fairly high level of turnover to the list. 12 of the 24 names from the previous run made it to the current list, which was also 24 names. Performance-wise, the list created in March has returned an unweighted average return of 2.6% through June 28, with 80% of the stocks in positive territory. All of the money-losers from the previous list fell out of consideration.

So without further ado, the names on the chopping block from the previous list are: PW Eagle (PWEI), Insteel Industries (IIIN), Allied Defense (ADG), Hartmarx (HMX), Parlux (PARL), Hansen Natural (HANS), FirstFed Financial (FED), Young Innovations (YDNT), ITT Educational (ESI), Rent-a-Center (RCII), Valassis (VCI), and Travelzoo (TZOO). The castaways include four of the five money losers from the previous portfolio (HMX, PARL, YDNT and TZOO) as well as the biggest gainer (ESI).

The new Small-Cap Watch List is:

Next I present my planned updates to the Mid-Cap Watch List. There was a fairly high level of turnover to the list. 14 of the 24 names from the previous run made it to the current list, which is also 24 names. Performance-wise, the list created in March has returned an unweighted average return of about 2.0% (Stockpickr hasn’t figured out at the time of writing that SEIC’s 2-1 split did not result in a 50% loss) through June 24, with 63% of the stocks in positive territory. All of the money-losers from the previous list fell out of consideration.

So without further ado, the names on the chopping block from the previous list are: Pool Corp. (POOL), First Federal (FED), Quebecor (IQW), Shuffle Master (SHFL), Valassis (VCI), NutriSystem (NTRI), IMS Health (RX), Komag (KOMG), Travelzoo (TZOO), and New Jersey Resources (NJR). This list includes the biggest losers (SHFL, KOMG, TZOO) as well as some middling performers and the best performer (NTRI).

The new Mid-Cap Watch List is:

Finally I present my planned updates to the Large-Cap Watch List. There was a fairly high level of turnover to the list. 14 of the 26 names from the previous run made it to the current list, which was only 25 names. Performance-wise, the list created in March has returned an unweighted average return of 3.8% through June 28, with 64% of the stocks in positive territory.

So without further ado, the names on the chopping block from the previous list are: Steel Dynamics (STLD), NVR (NVR), RWE AG (RWEOY), Sierra Health (SIE), Sallie Mae (SLM), Moody’s (MCO), TJX Companies (TJX), Abercrombie & Fitch (ANF), IMS Health (RX), Oracle (ORCL), CH Robinson (CHRW) and PG&E (PCG). Sallie Mae was one of the portfolio’s bigger winners due to its pending buyout.

The new Large-Cap Watch List is:

I will continue to track all my watch lists on StockPickr.