Market Preview: Flipping the Script

Updated from 8:03 p.m. to include additional information on after-hours action, Take-Two Interactive's quarterly report.

NEW YORK (TheStreet) -- The best stocks in 2012 have been the worst ones of 2011, which doesn't exactly speak well of this rally.

In a research issued Wednesday, Birinyi Associates used nine different criteria to evaluate the performance of the S&P 500 in January when the index gained 4.4% on a price basis: trailing price-to-earnings ratio, 2011 change, forward P/E, five-year growth rate, yield, price to book, price to sales, debt to equity and market value.

The firm, which noted these metrics are all independent of each other, then sorted stocks by each criteria, divided the index into 10 groups of 50 companies, and calculated the performance of each group. The results were the complete opposite of what played out in 2011.

"In January the worst strategy was to own the 50 stocks with the highest dividend yield at the start of 2012," wrote analyst Jeffrey Yale Rubin. "That group of fifty, on average, lost 1.03%. Perhaps not so coincidentally, that was the best strategy in 2011. The best performing strategy in January was to buy the stocks that were the worst performers last year."

The 50 worst performers of 2011 -- names like Netflix(NFLX), First Solar(FSLR), Sears Holdings(SHLD), and Bank of America(BAC) -- returned 11.9% for the month.

So basically, January's buyers were bargain shoppers, a theme that should carry over into the flood of same-store sales reports the retailers will be issuing on Thursday.

The expectation is for an overall increase of 2% from the limited group of retailers who report their monthly performance, according to Thomson Reuters, down from 4.8% in the same period a year earlier. Gift card redemptions should be a positive, but the month is also known for being highly promotional in order to get remaining holiday season merchandise out the door.

The discount retailers are seen doing the best, estimated to deliver a 4.8% gain vs. respective increases of 2.8% for department store operators and 0.7% for apparel sellers, and an anticipated 2.7% decline for drug store operators.

The names expected to post the biggest increases, again according to Thomson Reuters, are The Buckle(BKE), estimated to be up 7.3%; Saks(SKS) at 6.2%; Costco Wholesale(COST), at 6.1%; and Nordstrom(JWN) at 5.3%.