Top Five Mid-Cap Stocks

Each weekday, TheStreet.com Ratings compiles a list of the top five 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, mid-cap stocks are in the spotlight. These are stocks of companies that have market capitalizations of between $500 million and $10 billion that rank near the top of all stocks rated by our proprietary quantitative model, which looks at more than 60 factors.

The stocks must also be followed by at least one financial analyst who posts estimates on the Institutional Brokers' Estimate System. They are ordered by their potential to appreciate.

Note that no provision is made for off-balance-sheet assets such as unrealized appreciation/depreciation of investments, market value of real estate or contingent liabilities that might affect book value. This could be material for some companies with large underfunded pension plans.

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Today begins with Magellan Midstream Partners(MMP Quote), which engages in the transportation, storage and distribution of refined petroleum products in the U.S. It has been rated a buy since May 2005. The company has seen record transportation volumes thanks to increasing demand for natural gas and petroleum products in the U.S. and a highly favorable industry outlook going forward. It offers an attractive dividend yield at current price levels and is poised for strong revenue growth in the coming quarter.

Risks still remain. There has been a substantial rise in oil prices over the past two years, which could cause a decline in demand for finished products. Reduced demand would lead to a drop in transportation volume and possibly to the freezing of rates. Also, Magellan has raised a huge amount of debt and plans to further increase its leverage to fund aggressive expansion plans.