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"Top Buys" in our AI Stock Quant Models that have Under-Performed in 2018

Dec 03, 2018

 

Today, we take a look at “Top Buys” in our Multi-Factor AI Quant Stock Models that are largely negative year-to-date (YTD) to identify “Top Buys” in our Multi-Factor AI Quant Stock Models that may offer an opportunity for a bounce-back heading into the December trading month.

  • In the tables below, we highlight 12 “Top Buys” in our US Large-Cap Stock Model and 12 “Top Buys” in our US SMID-Cap Stock Model that are down the most YTD. These stocks may have the potential to sharply rebound heading into the December trading month.

Worst Performing YTD "Top Buys" in our US Large-Cap Global Top Stock Idea Model

Company Name Ticker November Return YTD Return "Top Buy" in Another Model?
LENNAR CORP LEN -2.97% -32.43% No
TOLL BROTHERS INC TOL -1.58% -31.34% No
NVR INC NVR 4.24% -30.16% No
GENERAL MILLS INC GIS -4.54% -28.64% Yes, US Consumer Staples
MASCO CORP MAS 0.96% -27.88% No
SEI INVESTMENTS CO SEIC -1.05% -25.27% No
HARTFORD FINANCIAL SERVICES HIG -3.52% -21.48% No
PULTEGROUP INC PHM 7.54% -20.24% No
MYLAN NV MYL 4.41% -19.97% No
COLGATE-PALMOLIVE CO CL 5.73% -15.81% No
NORTHROP GRUMMAN CORP NOC -4.86% -15.32% Yes, US Industrials
FIDELITY NATL FINL FNF GROUP FNF -0.39% -14.37% No

Source: Capital IQ

Two “Top Buys” in our US Large-Cap Global Top Stock Idea Model stand out as they are also rated “Top Buys” in their respective sector-specific models:

  • 1.) General Mills (GIS) shares fell 4.54% in November while the stock is down 28.64% YTD. Investors who expect a market downturn in 2019 or a slowdown in global economic growth may want to consider an investment in General Mills as it offers one of the highest dividend yields (4.5%) in the non-cyclical consumer staples sector. Although it has high debt levels, management has laid out a clear path to pay down their debt 
     
    • General Mills maintains a “Top Buy” rating in our US Consumer Staples Global Top Stock Idea Model in addition to a “Top Buy” rating in our US Large-Cap Global Top Stock Idea Model.
       
  • 2.) Northrop Grumman Corporation (NOC), whose shares fell 4.86% in November and are down 15.32% YTD may also warrant an investment consideration for those who expect a market downturn in 2019. Northrop Grumman is a top competitor in the global aerospace and defense industry who is poised to benefit from the acquisition of Orbital ATK that was approved by regulators in June.
     
    • Northrop Grumman receives a “Top Buy” rating in our US Industrials Global Top Stock Idea Model in addition to a “Top Buy” rating in our US Large-Cap Global Top Stock Idea Model.

Worst Performing YTD "Top Buys" in our US SMID-Cap Global Top Stock Idea Model

Company Name Ticker November Return YTD Return "Top Buy" in Another Model?
VALHI INC VHI -8.89% -66.77% No
PETMED EXPRESS INC PETS -15.38% -47.05% No
TC PIPELINES LP TCP -1.62% -43.90% No
WISDOMTREE INVESTMENTS INC WETF -9.80% -43.51% No
AGROFRESH SOLUTIONS INC AGFS -26.91% -43.11% No
GP STRATEGIES CORP GPX -9.87% -42.93% No
PATRICK INDUSTRIES INC PATK -12.14% -42.81% No
VECTOR GROUP LTD VGR -5.33% -40.88% No
MULTI-COLOR CORP LABL -20.64% -40.68% Yes, US Industrials
EBIX INC EBIX -15.38% -40.42% Yes, US Information Technology
SPARTON CORP SPA 15.34% -37.73% No
SCHWEITZER-MAUDUIT INTL INC SWM -14.20% -37.15% No

Source: Capital IQ

Two “Top Buys” in our US SMID-Cap Global Top Stock Idea Model stand out as they are also rated “Top Buys” in their respective sector-specific models:

  • 1.) Multi-Color Corporation (LABL) shares are down 40.68% YTD after tanking 20.64% in November. Multi-Color trades at a cheap forward P/E of 10.26x its forward 12M earnings while offering a strong trailing ROE of 14.47%. 
     
    • Multi-Color is rated “Top Buy” in our US Industrials Global Top Stock Idea Model while it also maintains a “Top Buy” rating in our US SMID-Cap Global Top Stock Idea Model.
       
  • 2.) EBIX Inc. (EBIX) shares are down 40.42% YTD after falling 15.38% in November. EBIX offers investors high growth potential with top-line revenue that grew 37.4% y/y in FY2018 and gross profit that increased 64.7% y/y in FY2018.
     
    • EBIX receives a “Top Buy” rating in our US Information Technology Global Top Stock Idea Model while it also receives a “Top Buy” rating in our US SMID-Cap Global Top Stock Idea Model.