Markets & Finance

America West Lands in S&P Top Ten


On Oct. 30, Standard & Poor's equity research group made changes to the S&P Top 10 portfolio -- those issues it considers to be the best candidates for capital gains over the next 6 to 12 months. S&P replaced Jacobs Engineering (JEC) with America West Holdings (AWA).

Like all the stocks in the portfolio, America West carries S&P's highest investment ranking, 5 STARS (buy). Jacobs exited the portfolio on Oct. 30 after S&P analyst Stewart Scharf downgraded the shares to 4 STARS (accumulate) from 5 STARS.

America West operates America West Airlines, a commercial carrier that operates through hubs in Phoenix, Ariz., and Las Vegas, Nev. In S&P's opinion, America West's operational turnaround bolsters the shares' upside potential. S&P analys James Corridore recently raised his forward earnings forecasts on the company, and he also boosted his 12-month target price to $25 from $11, valuing the stock at 21 times S&P's 2005 EPS estimate of $1.20. S&P also views America West's earnings quality as relatively high, reflecting the absence of defined pension plan liabilities.

Year-to-date through Sept. 30, the S&P Top Ten portfolio gained 26.48% vs. an advance of 14.73% for its benchmark, the S&P 500-stock index (both of these performances include dividends).

Here's the latest list:

S&P Top 10 Portfolio

Company

Price

(10/30/03 close)

12-Month Target

Investment Rationale

America West Holdings (AWA)

14.58

25

Outperforming peers; valuation

Barr Labs (BRL)

76.70

84

Superior earnings growth over the coming years

Comcast (CMCSA)

33.40

37

Increasing synergies from broadband acquisition

Corinthian Colleges(COCO)

62.76

65

See extended growth period; undervalued

DR Horton (DHI)

39.80

44

Better-than-expected industry trends

Fair Isaac (FIC)

63.48

75

Attractive valuation

Flextronics (FLEX)

14.36

19

Firming business, low valuation

Intel (INTC)

32.89

42

Recovery in worldwide chip demand expected to drive growth

Lennar (LEN)

91.50

108

Favorable business model, sector strength

Martek Biosciences(MATK)

48.37

61

Annual revenue growth of nearly 100% seen through fiscal 2004

For more information about the Top 10 portfolio, please visit http://www.businessweek.com/investor/content/jun2002/pi20020617_8998.htm By Ken Shea and Robert Gold


Toyota's Hydrogen Man
LIMITED-TIME OFFER SUBSCRIBE NOW

Sponsored Financial Commentaries

Sponsored Links

Buy a link now!

 
blog comments powered by Disqus