Markets & Finance

Shooting STARS


By Numer de Guia Stocks with Standard & Poor's highest investment ranking, 5 STARS, are expected by S&P equity analysts to outperform the overall market over the next 6 to 12 months. As of May 16, 2002, 103 stocks carried that designation, out of a total of 1,157 issues covered by S&P analysts.

While it's a select group, it's not static. S&P analysts may give the 5-STAR ranking to a company not previously covered by S&P. Or a company with a lower STARS ranking may see a positive change in its business fundamentals -- or present a very attractive valuation -- that prompts an analyst to upgrade it to the top STARS category. On the flip side, companies may be downgraded from their 5-STARS standing if their fundamentals worsen -- or their stock price gets ahead of what S&P

analysts would consider a reasonable valuation.

We thought it would be worthwhile to take a look at companies that have recently moved up the STARS ladder to reach its highest rung. So in our latest screen, we searched for stocks with S&P rankings that have been upgraded to 5 STARS (strong buy) since the end of March, 2002, and that have maintained that rating as of May 16, 2002.

These 21 stocks emerged:

Ambac Financial (ABK)

American Standard (ASD)

Amsouth Bancorporation (ASO)

Banknorth Group (BKNG)

Barra (BARZ)

Cendant (CD)

Clear Channel (CCU)

Comcast (CMCSK)

Dreyer's Grand (DRYR)

GTech (GTK)

Helix Technology (HELX)

Hospitality Properties (HPT)

International Rectifier (IRF)

Laboratory Corp. of America (LH)

Lifepoint Hospitals (LPNT)

Longs Drug Stores (LDG)

Moore (MCL)

Ocean Energy (OEI)

Omnicom Group (OMC)

Sysco (SYY)

Triad Hospitals (TRI) De Guia is a portfolio services analyst for Standard & Poor's


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