E Best & Worst Small Cap Report - December 3, 2015

  • The strongest small cap sector is financials.
  • The best small cap industry is heavy construction.

The average small cap score is 56.16 and that's above the four week average score of 53.56. The average small cap stock in our universe is trading -29.36% below its 52 week high, -3.5% below its 200 dma, and has 7.87 days to cover held short.

Financials, industrial goods, utilities, and technology score above average. Consumer goods score in line. Services, healthcare, and basic materials score below average.

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Heavy construction (GVA, MTRX, AEGN) is the highest scoring small cap industry. S&Ls (NWBI, BRKL, BANR, DCOM, PROV, COLB), staffing (KFY, KFRC, CCRN), regional banks (CFNL, TCBK, BBCN), and application software (LOGM, EPAY, PRO, PFPT, QLYS) also score strong.

No small cap basics baskets score above average. Processed & packaged goods (DMND, BDBD) and auto parts (SRI, SMP) are best in consumer goods. The top financials baskets include S&Ls, regional banks, and investment brokers (KCG). Home healthcare (LHCG, CHE, AFAM), specialized health services (IPCM, USPH, AHS), and medical instruments (CMN, ATRI, MGCD, VASC, LMNX, ICUI, ATRC) are top scoring in healthcare. Buy heavy construction and aerospace/defense (AVAV, LMIA) in industrial goods. The top services groups are staffing, resorts/casinos (MCRI, BYD), and marketing services (ABTL, NCMI). Application software, specialized semiconductor (MPWR), and business software (EBIX, PRFT, CSGS) can be bought in technology. December kicks off a five month run in average excess return for semiconductors that coincides with a bottoming of the SEMI book-to-bill.

 

Disclosure: None.

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