TheStreet.com Ratings: Top 10 Small-Cap Stocks
Each weekday, TheStreet.com Ratings compiles a list of the top 10 stocks in five categories -- fast-growth, all-around value, large-cap, mid-cap and small-cap -- and publishes these lists in the Ratings section of our Web site.
This list, updated daily, is based on data from the close of the previous trading session. Today we look at small-cap stocks. These are stocks of companies that have market capitalizations of between $50 million and $500 million that rank near the top of all stocks rated by our proprietary quantitative model, which looks at more than 60 factors. In addition, the stocks must be followed by at least one financial analyst who posts estimates on the Institutional Brokers' Estimate System. The stocks are ordered by their potential to appreciate.
Up first today is Preferred Bank (PFBC), which has 10 full-service branches focused on California's large Chinese-American population. The company's stock has earned a buy rating since December 2005. The stock should outperform most stocks we rate on the basis of its steady EPS growth, positive increases in net income, compelling return on equity and solid stock performance.
The stock is relatively more expensive than its peers. However, Preferred Bank shows no glaring weaknesses, and its strong financial performance justifies its higher price level.
Riverview Bancorp (RVSB), the parent company of Vancouver-based Riverview Community Bank, has been rated a buy since December 2004. The company's strengths include its notable return on equity, solid stock performance, impressive record of EPS growth and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
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