Small Cap Report: Best And Worst
The highest scoring names in small cap from 1 year ago (3/28/2013) returned 1,033 bps more than the Russell 2000. The best performers have been RAD up 251%, CAMP up 153%, GBX up 104%, MDSO up 96%, HOMB up 90%, and LOJN up 82%.
- Utilities (small sample size), consumer, and industrials score best.
- The top small cap industry is P&C insurance.
The average small cap score is 50.87, below the four week moving average score of 56.79. The average small cap is -20.75% off its 52 week high, 5.60% above its 200 dma, and has 6.77 days to cover held short.
Utilities, consumer, industrials, services, and financials score above average. Basics score in line. Technology and healthcare score below average.
NOTE: Scores will roll to reflect Q2 seasonality next week. This will affect leadership.
SMALL CAP | 3/20/2014 | 3/27/2014 | 4 Week MA | |||
Company Name | Symbol | Sector | INDUSTRY | SCORE | SCORE | SCORE |
BEST | ||||||
Cali. Water Svcs. | CWT | UTILITIES | WATER UTILITIES | 95 | 100 | 97.5 |
Diodes Inc | DIOD | TECHNOLOGY | SEMICONDUCTOR- INTEGRATED CIRCUITS | 105 | 85 | 93.75 |
Francesca's Holdings | FRAN | SERVICES | SPECIALTY RETAIL, OTHER | 80 | 85 | 82.5 |
Mercantile Bank | MBWM | FINANCIALS | REGIONAL BANKS | 85 | 85 | 83.75 |
Orthofix | OFIX | HEALTHCARE | MEDICAL APPLIANCES & EQUIPMENT | 85 | 85 | 83.75 |
Twin Disc | TWIN | INDUSTRIAL GOODS | DIVERSIFIED MACHINERY | 85 | 85 | 82.5 |
Agilysys Inc | AGYS | SERVICES | ELECTRONICS WHOLESALE | 100 | 80 | 97.5 |
Builders FirstSource | BLDR | SERVICES | HOME IMPROVEMENT STORES | 95 | 80 | 93.75 |
Chemed Inc | CHE | HEALTHCARE | HOME HEALTH CARE | 100 | 80 | 93.75 |
Cali. Water Svcs. | CWT | UTILITIES | WATER UTILITIES | 100 | 80 | 92.5 |
Finish Line Inc | FINL | SERVICES | APPAREL STORES | 95 | 80 | 93.75 |
MarineMax, Inc. | HZO | SERVICES | SPECIALTY RETAIL, OTHER | 95 | 80 | 86.25 |
Jakks Pacific Inc. | JAKK | CONSUMER GOODS | TOYS & GAMES | 75 | 80 | 78.75 |
Penford Corp | PENX | BASIC MATERIALS | SPECIALTY CHEMICALS | 95 | 80 | 87.5 |
Qlogic | QLGC | TECHNOLOGY | SEMICONDUCTOR-SPECIALIZED | 70 | 80 | 72.5 |
Heartware Int'l | HTWR | HEALTHCARE | MEDICAL INSTRUMENTS & SUPPLIES | 95 | 80 | 91.25 |
WORST | ||||||
UT Starcom | UTSI | TECHNOLOGY | WIRELESS COMMUNICATIONS | 25 | 20 | 22.5 |
Affymax | AFFY | HEALTHCARE | BIOTECHNOLOGY | 15 | 25 | 17.5 |
Coeur D Alene | CDE | BASIC MATERIALS | SILVER | 20 | 25 | 18.75 |
Cott Corp | COT | CONSUMER GOODS | BEVERAGES | 25 | 25 | 25 |
Cardiome Pharma | CRME | HEALTHCARE | DRUG MANUFACTURERS | 50 | 25 | 42.5 |
Earthlink | ELNK | TECHNOLOGY | INTERNET SERVICE PROVIDERS | 15 | 25 | 18.75 |
Hi Tech Pharma | HITK | HEALTHCARE | DRUGS-GENERIC | 30 | 25 | 26.25 |
Harmony Gold Mining | HMY | BASIC MATERIALS | GOLD | 50 | 25 | 31.25 |
Kopin | KOPN | TECHNOLOGY | DIVERSIFIED ELECTRONICS | 25 | 25 | 32.5 |
Quicksilver Res Inc | KWK | BASIC MATERIALS | INDEPENDENT OIL & GAS | 25 | 25 | 40 |
LSI Industries Inc | LYTS | CONSUMER GOODS | BUSINESS EQUIPMENT | 30 | 25 | 23.75 |
Rediff.com | REDF | TECHNOLOGY | INTERNET INFORMATION PROVIDER | 10 | 25 | 15 |
Sify Ltd | SIFY | TECHNOLOGY | INTERNET SERVICE PROVIDERS | 20 | 25 | 22.5 |
Sigma Designs | SIGM | TECHNOLOGY | SEMICONDUCTOR-SPECIALIZED | 20 | 25 | 20 |
Cambrex | CBM | HEALTHCARE | BIOTECHNOLOGY | 50 | 25 | 45 |
Cross Country Healthcare | CCRN | SERVICES | STAFFING & OUTSOURCING SERVICES | 50 | 25 | 45 |
Geron | GERN | HEALTHCARE | BIOTECHNOLOGY | 15 | 25 | 32.5 |
Triple-S Management | GTS | FINANCIALS | ACCIDENT & HEALTH INSURANCE | 15 | 25 | 20 |
Pain Thera | PTIE | HEALTHCARE | BIOTECHNOLOGY | 50 | 25 | 42.5 |
Verastem Inc | VSTM | HEALTHCARE | BIOTECHNOLOGY | 25 | 25 | 32.5 |
Seasonality shifts neutral for the coming three months. The Russell 2000 has gained in 6 of the past 10 years, producing an average return of 2.72%, with a standard deviation of 8.37%.
The top small cap industry is property & casualty insurers (STFC, MIG). Rate growth in 2013 offers profit opportunity in 2014. Fewer cat claims helped industry net income grow 60% year-over-year in 2013, aided by the best combined ratio since 2007. It will be hard matching that performance, so watch hurricane season closely. Restaurants (RRGB, DAVE, BJRI) score highly. The 17 restaurants in our all-cap universe are expected to post EPS growth of 13.3% next year. Apparel stores (FINL, PLCE, CACH) benefit from improving weather. Clothing retail sales in February came in 2.6% higher year-over-year. Processed & packaged goods (KTEC, BDBD) round out the best small cap industry list this week.
In small cap basics, only industrial metals & minerals (BOOM) score above average. Trade up in market cap where possible. In consumer goods, focus on processed & packaged goods, home furnishings (STLY, SCSS), and textiles (DXYN, PERY). The best financials baskets include P&C insurers, regional banks (MBWM, CFNL), and savings & loans (NWBI, PROV). In healthcare, buy home healthcare (CHE, ADUS), medical instruments (HTWR, VASC), and medical appliances (OFIX, CYBX, BABY). No industrial goods basket scores above average, focus on large and mid cap instead. In services, concentrate on restaurants, apparel services, and business services (EXAM, CGX). The top technology groups are semi ICs (DIOD, PLXT), scientific & technical instruments (ALOG, FLDM, AFFX), and specialized semiconductor (QLGC, MPWR). Semi book-to-bill historically peaks in the second quarter -- position accordingly.
SMALL CAP INDUSTRY SCORE | 3/27/2014 | |
Sector | INDUSTRY | Score |
BASIC MATERIALS | INDUSTRIAL METALS & MINERALS | 58.00 |
BASIC MATERIALS | INDEPENDENT OIL & GAS | 51.00 |
BASIC MATERIALS | STEEL & IRON | 49.29 |
BASIC MATERIALS | OIL & GAS DRILLING & EXPLORATION | 43.33 |
BASIC MATERIALS | GOLD | 43.00 |
CONSUMER GOODS | PROCESSED & PACKAGED GOODS | 61.25 |
CONSUMER GOODS | HOME FURNISHING & FIXTURES | 56.67 |
CONSUMER GOODS | TEXTILES | 56.00 |
CONSUMER GOODS | AUTO PARTS | 48.00 |
FINANCIALS | PROPERTY & CASUALITY INSURANCE | 64.00 |
FINANCIALS | REGIONAL BANKS | 57.86 |
FINANCIALS | SAVINGS & LOANS | 56.67 |
FINANCIALS | CREDIT SERVICES | 47.50 |
FINANCIALS | INVESTMENT BROKERAGE | 45.00 |
HEALTHCARE | HOME HEALTH CARE | 52.86 |
HEALTHCARE | MEDICAL INSTRUMENTS & SUPPLIES | 51.90 |
HEALTHCARE | MEDICAL APPLIANCES & EQUIPMENT | 51.90 |
HEALTHCARE | SPECIALIZED HEALTH SERVICES | 50.71 |
HEALTHCARE | DRUG RELATED PRODUCTS | 50.00 |
HEALTHCARE | BIOTECHNOLOGY | 46.48 |
HEALTHCARE | DRUG MANUFACTURERS | 43.67 |
INDUSTRIAL GOODS | GENERAL BUILDING MATERIALS | 51.25 |
INDUSTRIAL GOODS | HEAVY CONSTRUCTION | 51.25 |
INDUSTRIAL GOODS | AEROSPACE/DEFENSE PRODUCTS & SERVICES | 49.00 |
INDUSTRIAL GOODS | INDUSTRIAL ELECTRICAL EQUIPMENT | 46.67 |
SERVICES | RESTAURANTS | 63.00 |
SERVICES | APPAREL STORES | 62.31 |
SERVICES | BUSINESS SERVICES | 56.67 |
SERVICES | RAILROADS | 55.00 |
SERVICES | SPECIALTY RETAIL, OTHER | 55.00 |
SERVICES | EDUCATION & TRAINING SERV | 53.33 |
SERVICES | STAFFING & OUTSOURCING SERVICES | 51.00 |
SERVICES | TRUCKING | 50.00 |
SERVICES | MANAGEMENT SERVICES | 48.75 |
SERVICES | RESORTS AND CASINOS | 48.75 |
SERVICES | MARKETING SERVICES | 46.67 |
SERVICES | CATALOG & MAIL ORDER HOUSES | 45.00 |
SERVICES | BROADCASTING | 43.00 |
TECHNOLOGY | SEMICONDUCTOR- INTEGRATED CIRCUITS | 60.00 |
TECHNOLOGY | SCIENTIFIC & TECHNICAL INSTRUMENTS | 59.00 |
TECHNOLOGY | SEMICONDUCTOR-SPECIALIZED | 56.67 |
TECHNOLOGY | BUSINESS SOFTWARE & SERVICES | 53.75 |
TECHNOLOGY | SEMICONDUCTOR EQUIPMENT & MATERIALS | 53.75 |
TECHNOLOGY | NETWORKING & COMMUNICATION DEVICES | 53.33 |
TECHNOLOGY | DIVERSIFIED ELECTRONICS | 50.00 |
TECHNOLOGY | COMMUNICATION EQUIPMENT | 48.57 |
TECHNOLOGY | INTERNET SOFTWARE & SERVICES | 48.33 |
TECHNOLOGY | INTERNET INFORMATION PROVIDER | 47.50 |
TECHNOLOGY | PRINTED CIRCUIT BOARDS | 46.25 |
TECHNOLOGY | APPLICATION SOFTWARE | 44.17 |
TECHNOLOGY | INFORMATION TECHNOLOGY SERVICES | 44.17 |
TECHNOLOGY | COMPUTER PERIPHERALS | 36.67 |
TECHNOLOGY | WIRELESS COMMUNICATIONS | 33.75 |
TECHNOLOGY | INTERNET SERVICE PROVIDERS | 28.33 |
None.