Following the end of the first quarter, the Sabrient “Baker’s Dozen” is up 19.99% while the SPY, the ETF that tracks the S&P 500, has gained only 6.29%.
The Sabrient “Baker’s Dozen” comprises a diverse group of stocks spread across nine sectors: Technology, Consumer Services, Consumer Durables, Consumer Non-Durables, Healthcare, Energy, Basic Industries, Public Utilities, and Finance. The 13 selected stocks represent a cross-section of the industries and are only those that scored the highest in Sabrient’s rankings for company outlook, value, and growth. One-year and 5-year projected growth rates were also used to decide the best stocks.
These stocks are meant to be held for the entire year of 2011, and one quarter into the year, 12 out of the 13 stocks are currently gaining, with the strongest performers in the Healthcare, Technology, and Energy sectors. Here are some highlights from the portfolio.
Energy sector stocks exceeded expectations in both the ever-dominant oil and rising renewable markets. Trina Solar(NYSE:TSL), a solar panel manufacturer, is up 27.28%, and will potentially benefit further from the crisis in Japan, as more focus is put on renewable energy and less is put on nuclear energy. Given Trina’s already strong predicted growth rate, the recent current events should boost the stock’s momentum as more investors become willing to put their money in solar.
An increase in the demand for oil generally follows an increase in economic growth; Marathon Oil’s stock (NYSE:MRO), the second in the Energy sector, is up 42.86%. The economic recovery that everyone is looking for as well as the recent tragedy in Japan should continue to fuel strong projected one-year growth expectations for MRO.
Healthsprings (NYSE:HS), a managed care organization with a primary focus in Medicare was included in the Baker’s Dozen because it scored in the 90s on Sabrient’s Outlook, Value and Growth Scores and carried a Strong Buy rating from the Sabrient Ratings Algorithm (all of Sabrient’s scores are out of 100). Its projected year-over-year earnings growth was 15.9%, and its stock price has increased 46.21% since the beginning of the year!
In the technology sector, MKS Instruments Inc. (NASDAQ:MKSI) has exceeded expectations, posting gains of 37.51% so far this year. MKS provides instruments, subsystems, and process control solutions for advanced manufacturing processes. They make semiconductors, flat panel displays, optic storage devices, and solar cells. It earned strong Outlook, Value, and Growth scores (all in the 90s), and it had a projected year-over-year earnings growth rate of 25.1% from analysts. It is a strong stock that will also benefit from the recent move towards renewable energies that has followed the crisis in Japan. Even before the disaster, it received a 10 million dollar solar panel contract in February.
We’ve highlighted four of the Baker’s Dozen, but all 13 are stocks that have high earnings growth at a reasonable valuation (GARP) from companies with solid accounting practices. These stocks are meant to be held for the entire 12 months of 2011, but, at the end of the first quarter, the gains are already nearly 20%! Since only three months are behind us, there is still time to capitalize on these stocks. For more details on the rest of the stocks in the Baker’s Dozen,download the full report here.