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 mid-cap stocks. 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 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.
Today begins with
( WW), a human resources consulting company. It has been rated a buy since March 2005. The company's strengths include steady revenue growth, solid stock price performance, impressive increases in net income and a compelling record of EPS growth.
These strengths outweigh the company's weak operating cash flow.
Oil and gas transportation company
has maintained a buy rating since June 2006. The company has recently acquired valuable natural gas and processing assets that reduce its dependence on regulated fee-based transportation revenue.
Oneok shows impressive revenue growth, and superior return-on-equity that is significantly higher than that of the industry average. It also has enjoyed impressive net income growth.
Risks to the buy rating include any unexpected rise in interest rates, which could drag down profits because the company has raised more debt to fund its aggressive expansion strategy. Oneok is also vulnerable to the risk of a compressed gathering and processing margin, which is related to volatile natural gas prices.
Asbury Automotive Group
, which operates 125 automotive retail franchises, has been rated a buy since October 2005. The company has enjoyed strong revenue growth, a successful move toward premier and luxury brands, and several recent strategies that have boosted its used vehicle and parts, services and collision repair segments.
Since Asbury's performance is dependent upon gasoline prices, consumer confidence and the availability of consumer credit, any negative turn in interest rates or fuel prices could negatively impact its sales growth and threaten the buy rating.
A buy since March 2005,
( BEZ) designs, manufactures and sells electric motors and drives, speed reducers, industrial grinders, buffers, polishing lathes, stampings, castings and repair parts. Its custom and stock products are sold directly to original equipment manufacturers, as well as to independent distributors for resale.
The company's strengths can be seen in its strong stock price performance, revenue growth, improved return on equity and reasonable valuation levels by most measures. Given these positives, the company's subpar growth in net income is not a cause for concern.
Carrying a buy rating since March 2005,
Martin Marietta Materials
provides construction material for infrastructural, commercial and residential uses. The company displays solid revenue growth, an impressive pattern of EPS growth over the past two years, compelling net income growth and increased net operating cash flow.
, rated a buy since May 2006, makes equipment used for construction, mining, shipping, transportation and numerous other industries. The company has shown impressive revenue growth, a pattern of solid EPS growth, compelling net income growth, and outstanding stock price appreciation.
These strengths outweigh the company's low profit margins.
Rated a buy since October 2006,
develops, manufactures and markets high technology materials for precision use in industrial, medical, military, security and aerospace applications. Pronounced "two-six," the company's name refers to the two groups of the Periodic Table of Elements utilized by many of the components and materials made by the company.
II-VI demonstrates steady revenue growth, a very low debt-to-equity ratio, increased net operating cash flow and net income growth that has significantly outperformed its industry. These strengths outweigh the company's somewhat disappointing return on equity.
, rated a buy since March 2005, supplies precision instruments and services worldwide. The company shows steady revenue growth, strong stock price performance, a notable pattern of EPS growth over the past 24 months, and net income growth that has significantly exceeded that of its industry peers.
Given its impressive performance, Mettler-Toledo's weak operating cash flow is not a threat to its buy rating.
, a manufacturer of specialty metals and engineered products, has pinned down a buy rating since March 2005. The company shows a convergence of positive investment measures, including a notable return on equity, impressive stock price appreciation and compelling EPS growth.
The company's low profit margins are unlikely to threaten its buy rating.
Rated a buy since March 2005,
builds precision metal components in addition to assembling and distributing industrial supplies. It has shown solid revenue growth, significant EPS improvement, compelling net income growth and a debt-to-equity ratio below the industry average.
Even though its stock is currently trading at a price that is relatively more expensive than that of its peers, given its numerous strengths and lack of significant weaknesses, the higher price level is justified.