Below we highlight the best performing Russell 3,000 stocks since the March 9th, 2009 low as well as since the October 9th, 2007 market peak. As you'll see, the majority of the stocks that have done the best since March 9th are still down significantly from their 10/9/07 prices.

The real winners are the stocks that are up the most since the October 9th, 2007 market peak. These companies have seen big gains even as the market pulled back more than 60% before rallying again this year. Kirkland's (KIRK) has done the best since 10/9/07 with a gain of 1,111%. KIRK rose 170% during the 10/9/07-3/9/09 bear, and has since rallied an additional 348%. Other stocks that did well during the bear market and the current bull market include BSTC, BPSG, GTE, MITI, EBIX, JRCC, and NFLX.

It was pretty clear out the gate that the market would struggle as equity futures faded into the opening bell. There wasn't any panic per se, but tension in the air was thick enough to cut with a knife. The things that bugged me early on was the weakness in Chinese stocks and the inability of U.S. stocks to maintain momentum past 10:00 AM (the first 30-minutes of trading is often referred to as the "sucker's period" so it was a red flag that larger investors didn't step up to the plate). Professional investors are at a crossroad of sorts. Over the next couple of weeks they must decide to play along or hope their refusal to put money to work will pressure the market. Of course, the coolest customers out there have been buyers and who have become reluctant sellers, yesterday's lull notwithstanding. No matter what happens, even if the market does breakout this week, there isn't going to be mass hysteria.

The fact is that this trip through Dow 10,000, assuming it happens, doesn't have the economic backdrop of the other two trips beyond this now mythical number.

Just as we did Friday for the S&P 500, for our small cap focused readers we are providing a list of the top 20 performing stocks in the Russell 2000 as well as a sector breakdown of the YTD returns from the index to keep up to date on which companies and sectors have lead the way thus far through 3 quarters of 2009.

Also by using The Applied Finance Group’s (AFG's) research and valuation model we have provided further analysis on 4 of the top performing companies, 2 that we find attractive going forward and 2 that we find unattractive, based on valuation attractiveness, expected improvement in economic profitability and the overall investment attractiveness, which is based on various criteria AFG uses when identifying long/short opportunities.

As we enter the first trading day of the last quarter of 2009, below we provide a list of the 25 best performing stocks in the Russell 3,000 through the first three quarters of the year. All 25 stocks are up more than 500% year to date, and 9 are up more than 1,000%.

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F2Q10 Earnings Call

September 17, 2009 11:00 am ET

• Cuomo subpoenas BoA directors. New York Attorney General Andrew Cuomo subpoenaed five board members from Bank of America (BAC) in connection with the probe over Merrill Lynch bonuses. The five directors will likely be asked how much they knew about Merrill's losses, what role they played in disclosure decisions, whether there was pressure from government officials and whether the board sought outside counsel. Cuomo is also considering possible civil fraud charges against CEO Ken Lewis.
• eBay faces Skype lawsuit. The founders of Skype software have filed a copyright lawsuit against current owner eBay (EBAY) and the proposed buyers of a 65% stake in Skype, alleging breach of licensing terms and escalating eBay's ongoing legal drama over the unit. eBay denied the claims, but the suit could complicate the deal which is due to close in Q4 2009.
• Kodak takes a moment for financing. Eastman Kodak (EK) plans to raise up to $700M in debt to shore up its balance sheet. The financing, which is being led by Kohlberg Kravis Roberts, gives Kodak more financial breathing room and will help it pay off debt due next year. However, the deal is not without its costs and KKR could end up with as much as a 20% equity stake in Kodak through warrants issued as part of the deal. Shares -2.7% premarket (7:00 ET).
• FDIC repackages loans. The FDIC launched a new program yesterday to package loans from failed banks and subsidize their purchase by investors. To kick-off the long-awaited program, the FDIC announced a partnership with Residential Credit Solutions to take ownership of loans originally worth $1.3B. Officials said a second deal will follow soon, and others will be announced before the end of the year.
• Insurance regulators target ratings agencies. Regulators of some of the largest bond buyers in the world are considering cutting the role of ratings agencies in the market in response to the poor job the agencies did with complex mortgage securities. State insurance regulators are in the early stages of reassessing their reliance on firms like Moody's (MCO) and Standard & Poor's (MHP) and may opt instead for analysis from other financial firms with expertise in valuing the securities.
• California AG targets ratings agencies. In addition to being challenged by insurance regulators (see above) and facing heightened scrutiny from the SEC, ratings agencies will soon be under investigation by California Attorney General Jerry Brown for the role they played in the economic crisis through their evaluations of asset-backed securities. Ratings agencies "worked behind the scenes with the same Wall Street firms that created [the securities]," said Brown, earning "billions of dollars in revenue, at a rate double what they earned for rating other financial products." Brown didn't specify which companies will be investigated.
• Google focused on book deal. Google (GOOG) is reportedly in talks with the Department of Justice and a group of authors and publishers to modify its book-scanning settlement, with the hope of easing regulators' concerns that Google's ambitious project will discourage companies from competing for access to books online. Meanwhile, Google is buying reCaptcha, an online fraud prevention start-up, to use in its book-scanning project. Terms of the deal weren't disclosed.
• Oracle's sales cloud tech recovery hopes. Oracle (ORCL) reported quarterly earnings in-line with estimates (see details below), but its software sales were sharply lower than expected. New license sales were down 17% vs. the 4-14% decline Oracle had forecast, disappointing analysts hoping to see further signs of a tech sector rebound. Shares -2.1% premarket (7:00 ET). (Read Oracle's earnings call transcript)
• Toyota revs up for U.S. sales push. Toyota (TM) is planning a major marketing campaign to lift U.S. sales in Q4. The effort will cost $1B, which is 30-40% more than Toyota usually spends in a quarter, and will include subsidized leases and loans, customer incentives and financial support for dealer advertisements. The company also intends to expand its line of Prius hybrids.
• BoJ holds rates steady. As expected, the Bank of Japan left its key interest rate unchanged at 0.1%, but raised its economic forecast for the first time since July. The bank said "Japan's economic conditions are showing signs of recovery," a marked improvement from July's comment that the country's economy had "stopped worsening." (Read BoJ's statement (.pdf))
• Housing index ticks up. The NAHB Housing Market Index increased by 1 point to 19, its third straight gain and its highest point since May 2008. Current sales expectations and prospective buyer traffic ticked up, but expectations for the next six months declined slightly, likely as a result of the expected expiration of the homebuyer tax credit.
• Consumer prices rise. The Consumer Price Index rose 0.4% in August from the previous month and fell 1.5% Y/Y, vs. consensus of +0.3% and -1.7%. Core CPI rose 0.1% M/M and 1.4% Y/Y, both in-line with consensus.
• TIC: Foreign purchases fall. July Treasury International Capital data was released yesterday, with net foreign purchases of long-term securities registering at $15.3B, way down from June's $90.7B. Foreigners picked up $44B in long-term U.S. securities ($32.1B by private investors and $12B by official institutions), and U.S. residents bought $28.8B in foreign debt.
• Industrial production increases. Industrial Production rose 0.8% in August vs. consensus of +0.6%, the second straight monthly gain. July's increase was revised to +1% from +0.5%. Ex-auto, manufacturing was +0.4%. Capacity utilization rose to 69.6% from 69%, but is still 11.3 points below its historical average.
• Current account deficit. The Current Account Deficit was $98.8B in Q2 vs. consensus of $92B. The Q1 deficit was revised to $104.5B from $101.5B. The deficit on both goods and services moved lower.

Earnings: Thursday Before Open

• Pier 1 Imports (PIR): Q2 EPS of -$0.17 vs. consensus of -$0.22 (may not be comparable). Revenue of $287M (-11%) vs. $282M. Comparable store sales -7.6%. (PR)

Earnings: Wednesday After Close

• CKE Restaurants (CKR): Q2 EPS of $0.22 in-line. Revenue of $336M (-5%) vs. $341M. Same-store sales declined 2.3%. (PR)
• CLARCOR (CLC): FQ3 EPS of $0.42 misses by $0.01. Revenue of $230M (-17%) vs. $246M. (PR)
• Herman Miller (MLHR): FQ1 EPS of $0.22 beats by $0.03. Revenue of $324M (-32%) vs. $326M. (PR)
• Oracle (ORCL): FQ1 EPS of $0.30 in-line. Revenue of $5.1B (-5%) vs. $5.3B. Operating margin up 570bp to 46%; reduced value of foreign currencies hurt EPS by $0.02. (PR)
• The Dress Barn (DBRN): FQ4 EPS of $0.39 beats by $0.02. Revenue of $399M (+4%) vs. $401M. (PR)

Today's Markets

Markets worldwide are showing gains.

First off, management recently announced that it will retire $69.5 million of $6.375 Convertible Senior Notes through the issuance of 9% Convertible Senior Notes and a payment of $5 million.

Last week we took a look at the top performers in the S&P 500; today we're going to highlight the top performers in the Russell 2000 year-to-date and show you which companies look the most attractive according to The Applied Finance Group (AFG). AFG’s valuation techniques have proven successful since 1996 at identifying mispriced securities and helping their clients take advantage of those market inefficiencies. Beyond valuation AFG helps clients understand the true economic profitability a company earns by using their Economic Margin methodology.

AFG's Valuation Signal incorporates a concept AFG calls Percent to Target (Percent to Target measures the percent deviation between a stock’s current trading price and AFG's calculation of a company's intrinsic value). To derive the intrinsic value of a firm, AFG uses its proprietary Valuation Model (this model is a robust modified discounted cash flow model that avoids pitfalls of traditional DCF models such as perpetuity and competition).

Investors looking to get long some momentum stocks should take a look at the table below showing the best performing stocks in the Russell 3,000 year to date. These stocks are all up more than 200% in 2009 and are obviously showing relative strength versus the overall market.

Dollar Thrifty Automotive (DTG) is the best performing stock year to date with a gain of 1,197%! Borders Group (BGP) ranks second with a gain of 777% (lucky numbers?), followed by Avis Budget (CAR), Stein Mart (SMRT), and Providence Service Corp (PRSC). PALM is also on the list with a gain of 428% year to date. Its gain of $2.20 Friday moved it into the number nine slot.

There are currently 1,483 stocks in the Russell 3,000 that are up year to date, 134 are up more than 100%, and 38 are up more than 200%. When we're looking for momentum stocks to trade for our money management clients or our Bespoke Premium Model Stock Portfolio, an easy place to start a filter is by looking at the top performing stocks year to date. If you're looking to filter through some potential trades this weekend, below we highlight the Russell 3,000 stocks that are up more than 200% so far in 2009. These stocks have the best relative strength in the index, and have no doubt gotten the attention of other traders as they have outperformed. Dollar Thrifty (DTG) is up the most at 680%, followed by Providence Service (the Obama stock), Avis Budget (CAR), Borders Group (BGP), and Stein Mart (SMRT).

While the Russell 3,000 index is down 5.18% year to date, the average stock in the index is actually up 0.41%. Below we highlight the 30 best and worst performing stocks in the index so far in 2009.

The Providence Service Corp (PRSC) is the top performing stock in the Russell 3,000 year to date with a gain of 561%! Based on its profile, a Democratic-led government can't get any sweeter for the company:

F4Q09 Earnings Call

April 7, 2009 11:00 am ET

U.S. PRE-MARKET INDICATORS

-Dow Industrial futures down 120 points.

-S&P 500 futures down 14 points.

In 2008, many of the companies that became penny-stocks were household names, or at least well-known on Wall Street. They included retailers Rite Aid (RAD), Pier 1 Imports (PIR), Eddie Bauer (EBHI); radio broadcasters Westwood One (WON) and Sirius XM Radio (SIRI); auto-parts firms Dana Holding (DAN) and Noble International (NOBL); and financials Friedman Billings Ramsey Group (FBR) and Thornburg Mortgage (THMR.PK). Other notables were Citigroup (C), which has touched $0.97, and AIG (AIG), which has traded as low as $0.33.

Mall decline: Moving over to a virtual store business model?

You have to love family movie night. Last night we watched the John Hughes version of Miracle on 34th Street. In the not too distant past, I distinctly remember going into the colossal department stores as a kid, sitting on Santa Claus' lap, getting a picture with Santa and taking a ride down the slide back to mom and dad. Big Cleveland Department stores like May Company, Hallie's, and The Bing Company stood as icons of a thriving 1970s era retail with big train displays, Winter Wonderland villages, and even a few elves.

One scene from the movie which really caught my eye was the flood of people coming in these stores to visit Santa Claus. Cole's had the best Santa Claus, and everybody else was jealous. We went out to see the real Santa Claus the other night. This required a track to Great Northern Mall on the west side of Cleveland. All that I could think of was a 40 minute drive, and another hour wait to see Santa. However, much to my chagrin, we were met with a 10 minute wait. And this guy is supposed to be the best Santa in Cleveland. According to the photographers, business was down approximately 30% from last year. That would suggest that 30% less people found themselves in the mall thus far during Christmas and Hanukkah shopping.

F3Q09 Earnings Call

December 18, 2008 11:00 am ET