Top 25/50 Million:

In:

• Allied Healthcare International, Inc. (AHCI)
• Herbalife, Ltd. (HLF)
• Medicis Pharmaceutical Corp. (MRX)

Out:

• EarthLink, Inc. (ELNK)
• ValueClick, Inc. (VCLK)
• Verigy Ltd. (VRGY)

Top 25/2000 Million

In:

• Broadridge Financial Solutions, Inc  (BR)
• General Dynamics Corp. (GD)

Out:

• Rockwell Automation, Inc (ROK)
• Southern Copper Corp (PCU)

Top 25/50 Million:

In:

• Lam Research Corp (LRCX)
• KHD Humboldt Wedag International Ltd (KHD)
• NVIDIA Corp (NVDA)

Out:

• ChinaCast Education Corporation (CAST)
• Questcor Pharmaceuticals (QCOR)
• Meredith Corporation  (MDP)

Top 25/2000 Million

In:

• KBR Inc (KBR)
• Lam Research Corp (LRCX)
• MEMC Electronic Materials Inc (WFR)

Out:

• EMCOR Group, Inc (EME)
• Gannett Co., Inc. (GCI)
• Microsoft Corporation (MSFT)

Top 25/ 50 million

In

• CF Industries Holdings, Inc. (CF)
• Deluxe Corp. (DLX)

Out

• Diamond Management & Technology Consultants, Inc. (DTPI)
• ICF International Inc. (ICFI)

Top 25/ 2000 million

No Moves Since Last Week

When running the following screens, many of the names mentioned in the previous post will appear. Also, many names in the same sectors appear. For example, the magic formula screen is full of retailers, aerospace and defense, refiners, and tech. Many of the stocks mentioned below I have not done any research on but know them off the top of my head through reading, watching television and more reading.

Top 100 Stocks With a Minimum Market Cap of 250

American Eagle Outfitters (AEO)- See Previous article

Boeing (BA)- See previous article

Choice Hotels (CHH)- Slowing economy means less people not traveling as much.

Crocs, Inc (CROX)- Fad stock/

JAKKS Pacific (JAKK)- First of toy makers that will appear

Terra Industries (TRA)- Undervalued Ag play?

Top 100 Stocks With a Minimum Market Cap of 500

Ambercrombie and Fitch (ANF)- Might be the best teen retailers.

Aeropostale (ARO)- Has held up nicely despite consumer slowdown

Best Buy (BBY)- Interesting. Circuit City continues to struggle which might lead to gain in market share. Company has great history of developing shareholder value through buybacks, dividend increases,etc.. I will be more interested if it appears in top 25

Hasbro (HAS)- Toy makers.

Ingersoll-Roland (IR)- Berkshire Holding also trading at 52 week lows

Manpower (MAN)- Big staffing company

Microsoft (MSFT)- Surprisingly appearing early in the list. Not my circle of competence, but huge cash flow generator and trading at historic low valuations

Northrop Grumman (NOC)- n/a

Top 100 Stocks With a Minimum Market Cap of 1000

Exxon (XOM)-  Looks undervalued. Expectations on earnings seem low. Last i read company is buying back $10 billion dollars of shares.

General Dynamics (GD)- n/a

Harley-Davidson (HOG)- Will younger generation ride Harleys?

Hewlett Packard (HPQ)- Kicking the pooh out of Dell. Great business overseas.

Lockheed Martin (LMT)- n/a

Mattel (MAT)- n/a

Pfeizer (PFE)- Lipitor expires soon.

Sherwin-Williams (SHW)- Interesting. I am familiar with them through work.

Western Digital (WDC)- n/a

World Wrestling Entertainment (WWE)- I used to watch wrestling.

Top 100 Stocks With a Minimum Market Cap of 2000

3M (MMM)- Please get in top 25

Allegheny Technologies (ATI)- Supplier to Boeing

Amgen (AMGN)- I used to own them, but too much risk involving their drugs.

Chevron (CVX)- See XOM

Crane (CR)-n/a

Dish (DISH)- Cash flow generator

Gamestop (GME)- n/a

Honeywell (HON)- n/a

Nuecor (NUE)- Steel has had a nice run. I missed the boat when it was at $45

Raytheon (RTN)- n/a

TJX Companies (TJX)-

UST (UST)- The smaller tobacco stock

United Technologies (UTX)- Trading at historically low valuations

Wabco (WBC)- Berkshire Holding

That’s all folks! Hopefully I provided a great starting point. From past experience, I have had great success from the magic formula list. I use the top 25 so I can select from the highest ranking stocks but some on here look interesting especialy XOM, MMM, and IR.

One thing I have noticed about the magic formula screen is, as the market moves higher the quality of businesses decreases. Also, as the market moves lower, the quality of businesses increase. Let me explain. When the market was making new highs (remember 14,000?), I recognized few if any stocks on the list and had to do a lot more reading to be well informed on what company “x” is doing, its future plans, etc… This is how I discovered Accenture (ACN) which I sold at $34 and is now at $40 (see image). Now the markets are in bear market territory and some familiar names are appearing. When running the magic formula screen, I use the top 25 results for the following market caps: 50, 250, 500, 1000, 2000. This way I am able to see which stocks appear the most. For example, a company like Perini Corp. (PCR) appears in the magic formula screen (top 25) for the 50, 250, 500 million minimum market cap. Obviously, for Perini to show in 3 of the screens it must be ranked high. Also, I ran the 700 mill minimum market cap screen and it appears there.

50 Million Market Caps – Top 100

American Eagle Outfitters (AEO)- The stock of this popular teen retailer tanked after its chief marketing officer resigned bringing the stock to some historic low levels. Be careful though, company has auction rate securities (ARS) on hand which it might have to write down or take a write off. When and if it does, stock may go down providing an opporturnity. I established a small position on that basis.

Barrett Business Services (BBSI)-  My favorite among the staffing companies (there are many on the magic formula list). Obviously, its been beaten down as less people are hired during recessions. Also, temporary workers are usually the first to get the boot in bad times as companies downsize to keep expenses down as revenue decline or stay flat. One has to love a CEO who tells Wall St “If you guys want to sell [the company] down to five times earnings, maybe I will just buy the whole [expletive] thing.” The company has $5 in cash.

Boeing Co. (BA)- Nice backlog but cannot get a plane off the ground.  At these levels, I am interested and might establish a position.

Coach Inc. (COH)-  Their bags are expensive, yet women love them.

Frontier OIl Corp. (FTO)- Best of breed refiner suffering due to low (negative?) refining margins. Any increase in the spread would really help this company.

FreightCar America (RAIL)- Haven’t really checked the story but I know it has been talked about in the value investing community.

Gannett Co. Inc. (GCI)- Declining industry, stay away. A.K.A. Value Trap

Hansen Natural Corp (HANS)- Their MONSTER Drinks might not be selling like before but company has other great drinks. Might be worth investigating.

Herman Miller (MLHR)-  The maker of office furniture (known for their Aeron chair) showed up on my screen today. I’m impressed with their ability to continue results despite a weak U.S marker. Their management has given analysts nothing to chew on in the guidance front and I like it. I get the feeling that management is telling analysts “Do your homework”. Anyway, the company is doing a great job of getting their products in front of customers and selling on quality, quick delivery, etc.  A pretty straight forward plan for success.

Lear Corp. (LEA)- Struggles as long as auto industry struggles. Any rebound in auto sales will help company.

Manitowac Company (MTW)-Now, I have spent a good deal of time reading their statements. Thesis is simple: the company continues to expand globally but is getting pounded due to its domestic operations. Its Crane division might be worth more than its current market cap. The company is doing a fine job of expanding into India and China. Now, if the US Market recovers (which it will) its stock price can really run.

McGraw-Hill Companies Inc (MHP)- The maker of textbooks and owner of Standard and Poor’s has been beaten down for some reason, might be due to its S&P division but not sure. I read a while back their textbook sales in decline mode, but with me paying $100+ for a textbook I can see why

NVIDIA (NVDA)- Stock tanked 30% on Friday. Not in circle of compence

Perini Corp. (PCR)- Slowdown? What slowdown? You wouldn’t know there was a slowdown by reading their reports. The company has a 7 billion+ backlog and is planning to expand into Dubai and other foreign countries.

Premier Exhibitions (PRXI)- Interesting company as it deals with museum exhibition of the Titanic (something along those line).

These are the type of companies and stories you can find while the market is down. For a company to like Boeing (BA) to appear on the list using such a low market cap screen is interesting. I am 99% confident it will appear in the rest of the screens, in which I will make different post. Now, by no means is this a final list of companies to look into. The list above only mentions 15 out of the 100 companies that appeared using a minimum market cap of 50 million and 100 results. The other companies I have either mentioned before (ACN,PACR,etc..) or have not looked into as I usually look into the top 25.

I wanted to comment on the other screens (250, 500, 1000, 2000) but the article was getting a little lengthy so I am going to break them into pieces.

Disclosure: I own AEO, MTW, PCR, BBSI, MLHR