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, large-cap stocks are in the spotlight. These are stocks of companies with market capitalizations of over $10 billion that rank near the top of all stocks rated by our proprietary quantitative model, which looks at more than 62 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.
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.
Today leads off with
, which makes complex metal components and products for the aerospace and industrial gas turbine industries. It has been rated buy since June 2005.
The company has completed recent acquisitions to expand its casting, forging and fastener product offerings, which should fuel revenue growth. Precision also shows net income increases resulting from margin expansion and from continued operations (which were partially offset by higher interest expense and taxes).
Because Precision depends on the aerospace industry for its top-line growth, any slowdown in that industry could lead to reduced demand for its products. Any fluctuations in the prices of basic materials or any unseen difficulty in integrating recent acquisitions also could be concerns.
Global integrated energy company
has been rated a buy since May 2005. TheStreet.com Ratings' recommendation is based on the company's higher net income and earnings per share and expanding margins, as well as new reserve discoveries and greater production volumes. One example is its new start-up, the Bibiyana natural gas field in Bangladesh, which is expected to increase from its current 200 million cubic feet per day to a maximum of 500 million cubic feet per day by 2010.
Risks to the buy rating depend on the future movement of crude oil and natural gas prices, as well as the efficiency in production from new discoveries.
, which makes navigation, communications and information devices based on GPS technology, has been rated a buy since May 2005.
The company has shown outstanding revenue growth, notable return on equity, a two-year pattern of steady EPS increases and is carrying no debt. Though no company is perfect, we do not currently see any weaknesses that are likely to detract from the generally rosy outlook.
Rated a buy since May 2005,
is involved in the acquisition, development and exploration of oil and gas properties. The company has enjoyed an increase in oil prices and a rise in production across segments, and its debt-to-equity ratio has improved over the past year. It also recently acquired properties and mineral interests in eastern and north Texas worth $235 million.
Downside risks to the buy rating include declining margins and fluctuating energy prices.
Global management consulting, technology services and outsourcing company
has been rated a buy since May 2005. The company displays noteworthy revenue growth, a favorable debt-to-equity ratio and a pattern of positive EPS growth over the past two years. Powered by strong earnings growth in addition to other driving factors, its stock price increased 45.4% in the 12 months ending June 1.
These strengths outweigh the company's low profit margins. Although almost any stock can fall in a broad market decline, Accenture should continue to move higher even though it has already seen a nice gain in the past year.