The best scoring mid caps from one year ago (2/6/2013) averaged 196 bps of excess over the S&P 400, with 0% turnover.  The top performers include ILMN up 193%, NFLX up 121%, VRX up 102%, HBI up 83%, ALR up 74%, and OTEX up 73%.


 

• The best scoring mid cap sector is industrial goods
• The top mid cap industry is residential construction.    

The average score across our mid cap universe is 60.71 this week, below the four week moving average score of 66.28.  The average mid cap is trading -15.75% below its 52 week high, 0.42% above its 200 dma, has 7.15 days to cover short, and is expected to grow EPS by 18% next year.
 
The best scoring mid cap sector is industrial goods.  Consumer, healthcare, and technology also score above average.  Financials score in line.  Services, basics, and utilities score below average.
 

Commentary:

The S&P 400 (MDY) has finished April higher than it begins February in 8 of the past 10 years, rising an average and median 6.3% and 5.7%, respectively.  The MDY's standard deviation is 5.71% and its correlation to the S&P 500 is 0.91.

 
The following mid cap companies offer the best seasonal tailwinds for the three months ending April.

 The best scoring mid cap industry is residential construction (NVR, KBH, RYL).  After digesting 2012 and early 2013 gains, the industry is re-exerting as managers increasingly believe consumer confidence will outpace rising rates.  Residential construction spending grew 18% to $330.7 billion in 2013 from 2012.  Residential construction spend in December was 17.5% higher than a year ago.  Tight capacity and steady growth offers pricing opportunity for trucking (HTLD, KNX) this year.  Broadline semi (CAVM) is strong scoring in line with the seasonal improvement in book-to-bill.  Accident & health insurance (CNO, AIZ)  and business equipment (DBD, PAY) round out the mid cap best industries ranking this week.

 In mid cap basics, only oil & gas drilling (PTEN) score above average. Steel & iron (CMC) score in line.  Buy business equipment, textiles (COLM, DECK), and processed & packaged goods (HAIN, FLO) in consumer.  Only accident & health insurance and investment brokers  (SF, GBL) score above average across financials.  The top healthcare groups are hospitals (THC, LPNT) and biotech (TECH, QCOR).  In industrials, concentrate on residential construction, industrial electrical equipment (LFUS), and aerospace/defense (ESL, CW).  In services, buy trucking, restaurants (WEN, EAT, PZZA), and education (DV).  The best technology baskets are broad line semi, computer peripherals (ZBRA, LXK, EFII), and semi equipment & materials (TER).