Markets & Finance

PowerPicks Heat Up in June


By Ken Shea and Robert Gold The S&P PowerPicks 2005 portfolio -- representing S&P analysts' top picks for the year -- outperformed its benchmark, the S&P 500-stock index, by a wide margin in June. For the month, the portfolio returned 1.5%, vs. the S&P 500's gain of 0.1%, both including dividends.

The portfolio's top gainers on the month included Best Buy (BBUY), up 26%; ValueClick (VCLK), up 15%; Devon Energy (DVN), up 11%; Nabors Industries (NBR), up 10%; and Commerce Bancorp (CBH), up 10%.

The members of the portfolio that fared the worst in June included Qualcomm (QCOM), down 11%; FedEx (FDX), down 9%; Ingersoll-Rand (IR), down 8%; Cooper Cos. (COO), down 8%; and Kinetic Concepts (KCI), down 7%.

Year-to-date through June 30, the portfolio has generated

total return of 2.7%, vs. a 0.8% for the "500".

About the S&P PowerPicks 2005 Portfolio

The portfolio represents the collective "best ideas" of the Standard & Poor's equity research staff.

Each of the most senior 40 industry analysts on S&P's equity research staff has chosen one of the stocks they follow as the best-positioned for superior growth. The S&P PowerPicks 2005 Portfolio is diversified across all the 10 S&P economic sectors that make up the S&P 500 index.

The portfolio is a "frozen" one, meaning it will undergo no changes throughout the entire year. Its objective is to exceed the total return (capital appreciation plus dividends paid) generated by the S&P 500 index during the next 12 months.

THE S&P POWERPICKS 2005 PORTFOLIO

Ticker

Company

Mkt. Cap ($ Mln)

S&P Earns & Divd Rank

S&P Index

STARS

Dividend Yield (%)

Subindustry

Consumer Discretionary

BBY

Best Buy

18,290

B

500

5

0.8

Computer & Electronics Retail

GTRC

Guitar Center

1,225

NR

600

5

-

Specialty Stores

HET

Harrah's Entertainment

6,881

B

500

5

2.1

Casinos & Gaming

LQI

La Quinta

1,513

C

None

5

-

Hotels Resorts & Cruise Lines

NWS

News Corp.

52,569

NR

None

5

-

Movies & Entertainment

PSUN

Pacific Sunwear of California

1,647

B+

400

5

-

Apparel Retail

Consumer Staples

BF.B

Brown-Forman

5,959

A

500

5

1.8

Distillers & Vintners

CHTT

Chattem

717

B

None

5

-

Personal Products

PEP

PepsiCo

84,072

A+

500

5

1.8

Soft Drinks

WAG

Walgreen Co.

39,019

A+

500

5

0.6

Drug Retail

Energy

CVX

ChevronTexaco

115,676

B+

500

5

2.9

Integrated Oil & Gas

DVN

Devon Energy

20,131

B+

500

5

0.5

Oil & Gas Exploration & Production

NBR

Nabors Industries

7,775

B

500

5

-

Oil & Gas Drilling

Financials

ALL

Allstate

34,654

B+

500

5

2.2

Property & Casualty Insurance

C

Citigroup

232,241

A+

500

5

3.6

Other Diversified Financial Services

CBH

Commerce Bancorp

4,956

A+

400

5

1.2

Regional Banks

GS

Goldman Sachs Group

50,723

NR

500

5

1.0

Investment Banking & Brokerage

NDE

IndyMac Bancorp

2,181

B+

400

5

4.2

Thrifts & Mortgage Finance

SPG

Simon Property Group

13,770

B+

500

5

4.2

Real Estate Investment Trusts

Health Care

COO

Cooper Cos.

2,275

B

600

5

0.1

Health Care Supplies

IVGN

Invitrogen

3,099

B-

400

5

-

Biotechnology

KCI

Kinetic Concepts

4,339

NR

None

5

-

Health Care Equipment

PDLI

Protein Design Labs

1,731

C

400

5

-

Biotechnology

WAT

Waters Corp

5,638

B

500

5

-

Health Care Equipment

WLP

WellPoint

14,063

NR

500

5

-

Managed Health Care

Industrials

ASD

American Standard

8,353

B-

500

5

-

Building Products

BNI

Burlington Northern Santa Fe

16,932

A-

500

5

1.5

Railroads

FDX

FedEx

28,563

B+

500

5

0.3

Air Freight & Logistics

IR

Ingersoll-Rand

12,816

A

500

5

1.3

Industrial Machinery

KDN

Kaydon Corp

916

A-

600

5

1.5

Industrial Machinery

Information Technology

ADP

Automatic Data Processing

26,523

A+

500

5

1.2

Data Processing & Outsourced Services

DELL

Dell Inc.

101,163

B+

500

5

-

Computer Hardware

EMC

EMC Corp

32,158

B

500

5

-

Computer Storage & Peripherals

MXIM

Maxim Integrated Products

13,322

B+

500

5

1.0

Semiconductors

MSFT

Microsoft

291,467

B+

500

5

1.2

Systems Software

QCOM

Qualcomm

68,219

B

500

5

0.7

Communications Equipment

VCLK

ValueClick

1,046

NR

None

5

-

Internet Software & Services

Materials

DOW

Dow Chemical

47,592

B

500

5

2.7

Diversified Chemicals

Telecommunications Services

CTL

CenturyTel

4,430

A

500

5

0.7

Integrated Telecommunication Services

Utilities

TXU

TXU Corp.

18,293

B

500

5

0.8

Electric Utilities

Shea is director of global equity research, and Gold a senior portfolio group analyst, for Standard & Poor's Equity Research Services


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