3 Laggards Ready For A Comeback

Includes: CLF, JOY, LVS
by: Clayton Rulli

The market has been on a tear since the "sell in May, go away" syndrome hit several months ago. The averages have risen 10% since June, with some stocks rocketing higher - such as Apple Inc. (NASDAQ:AAPL), which some feel has led the entire market to three year highs. However, many well known companies have underperformed and have subsequently been "left in the dust". Is this warranted? Let's take a look at some well known laggards to see if it might be worth doing some bottom fishing.

Cliff Natural Resources Inc. (CLF)

Current Price 39.14
52 Week Range 32.25-80.15
Stock Appreciation Since June, 1 2012 -15%

Stock Appreciation Since Jan. 1, 2012



P/E Ratio 4.03x

There has been legitimate concerns that the iron and steel sectors could face significant headwinds as many countries slow in growth. On Monday, Sept. 10th, spot iron ore posted its biggest one-day gain on record, while China steel futures rose sharply for a second day. These price increases may be in response to Beijing approval of more than $150 billion in infrastructure projects (see here).

Do monster price increases like these signal a bottom may be in place?

Joy Global, Inc. (JOY)

Current Price 56.63
52 Week Range 47.69-96
Stock Appreciation Since June, 1 2012 +1.6%

Stock Appreciation Since Jan. 1, 2012



P/E Ratio 9.3x

JOY hasn't given its stockholders much happiness, but perhaps it will soon. Last quarter's revenue growth came in higher than the industry average of 9.9%. Revenues rose by 22.2%, and EPS improved 13% compared to same quarter last year. In addition, this company has demonstrated a pattern of positive earnings per share growth over the past two years (see here).

Is JOY's underperformance justified, or is the market's concern's overblown?

Las Vegas Sands Corp. (NYSE:LVS)

Current Price 43.40
52 Week Range 34.72-62.09
Stock Appreciation Since June, 1 2012 Unchanged

Stock Appreciation Since Jan. 1, 2012



P/E Ratio 25x

Worries over the gambling industry is wide spread, especially considering underemployed consumers are strapped for cash. However, LVS has showed strength relative to other gaming companies. Recent metrics show revenue growth has slightly outpaced the industry average of 0.7%. Since the same quarter one year prior, revenues rose by 10.1% (see here). There has been some signs of life in Macau, which is a very positive sign for LVS. September gaming revenue in Macau up 18% compared to the September from last year, according to Sterne Agee analyst David Bain (see here).

Perhaps LVS's recent performance will be noticed by the market?

Closing Thoughts:

Attempting to buy a stock that's stuck in the mud can be risky. Conversely, catching a stock before a big recovery could prove very rewarding. Not only should more research be done on these three laggards, but I feel it is very much warranted considering some recent signs of life they've showed.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.