NEW YORK (TheStreet) -- On Thursday, we get earnings reports from a sell-rated trucker, a strong sell-rated semiconductor company and a hold-rated food and drug retailer. More important in my judgment are earnings from two of the four "too big to fail" money-center regional banks.
The computer and technology sector is 23.1% overvalued, but has an overweight rating with 43.8% of the 1,163 stocks in this sector rated buy or strong buy.
The finance sector is 17.3% overvalued with an equal-weight rating.
The retail-wholesale sector is 24.5% overvalued, but has an overweight rating with 79.4% of the 354 stocks in the sector rated buy or strong buy.
The transportation sector is 24.4% overvalued with an "avoid-source-of-funds" rating with 74.3% of the 179 stocks in the sector rated sell or strong sell.
One of the five stocks previewed today is undervalued by 7.8%, with the other four overvalued by 14% to 92.8%. Three stocks have hold ratings, one has a sell rating and one has a strong sell rating. All have gains over the last 12 months with one gaining 92.5% and another soaring by 216.2%. All are trading above their 200-day simple moving averages, which reflects the risk of reversion to the mean.
Reading the Table
OV / UN Valued - The stocks with a red number are undervalued by this percentage. Those with a black number are overvalued by that percentage according to ValuEngine.
VE Rating - A "1-Engine" rating is a Strong Sell, a "2-Engine" rating is a Sell, a "3-Engine" rating is a Hold, a "4-Engine" rating is a Buy and a "5-Engine" rating is a Strong Buy.
Last 12-Month Return (%) - Stocks with a Red number declined by that percentage over the last twelve months. Stocks with a Black number increased by that percentage.
Forecast 1-Year Return - Stocks with a Red number are projected to decline by that percentage over the next twelve months. Stocks with a Black number in the Table are projected to move higher by that percentage over the next twelve months.
Value Level: is the price at which to enter a GTC Limit Order to buy on weakness. The letters mean; W-Weekly, M-Monthly, Q-Quarterly, S-Semiannual and A- Annual.
Pivot: A level between a value level and risky level that should be a magnet during the time frame noted.
Risky Level: is the price at which to enter a GTC Limit Order to sell on strength.
($13.99) set a multiyear high at $15.09 on Aug. 2 and then traded as $13.80 on Sept. 17, holding its 200-day SMA at $13.90. My annual value level is $12.54 with a semiannual pivot at $13.71 and semiannual risky level at $14.57.
($51.83) set a multiyear high at $56.93 on July 24 and then tested its 200-day SMA at $50.67 at the Sept. 25 low at $50.06. My semiannual value level is $50.37 with a monthly risky level at $55.71.
($18.49) set a multiyear high at $18.85 on Oct. 7. My quarterly value level is $15.46 with a monthly pivot at $18.11. This stock has a parabolic-bubble formation on its weekly chart starting the year at $6.13 and moving above its 200-week SMA at $8.58 in mid-January to a multiyear high on Monday.
($31.48) set a multiyear high at $32.72 on Sept. 26. My quarterly value level is $29.50 with a monthly risky level at $32.99.
($40.62) set a multiyear high at $44.78 on July 23 and then traded as low as $40.64 on Oct. 3. My semiannual value level is $40.04 with a weekly pivot at $40.60 with a monthly risky level at $44.97.
At the time of publication the author held no positions in any of the stocks mentioned.
This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.
Richard Suttmeier is the chief market strategist at AlphaPlus Analytics in addition to ValuEngine.com. He has been a professional in the U.S. Capital Markets since 1972, transferring his engineering skills to the trading and investment world.
Suttmeier has an engineering degree from Georgia Tech and a Master of Science degree from Brooklyn Poly. He began his career in the financial services industry in 1972 trading U.S. Treasury securities in the primary dealer community. He became the first long bond trader for Bache in 1978, and formed the Government Bond Department at LF Rothschild in 1981, helping establish that firm as a primary dealer in 1986. This experience gives him the insights to be an expert on monetary policy, which he features in his newsletters, and market commentary.
Suttmeier's industry licenses include, Series 7 and Registered Principal (Series 24). He has been the Chief Market Strategist for ValuEngine.com since 2008 and often appears on financial TV.
Click here for details on Suttmeier's "Buy and Trade" investment strategy.
Richard Suttmeier can be reached at RSuttmeier@Gmail.com