Top Five Mid-Cap Stocks: July 2 TSC Ratings TheStreet.com Ratings provides exclusive stock, ETF and mutual fund recommendations using proprietary tools. Our "safety-first" approach aims to reduce risk while achieving performance on a total return basis.Each business day, we compile a list of the top five stocks in one of five categories -- fast-growth, all-around value, large-cap, mid-cap and small-cap. Today, mid-cap stocks are in the spotlight. These companies have market capitalizations between $500 million and $10 billion and receive "buy"-ratings from our proprietary quantitative model, which considers more than 60 factors. The stocks are ordered by their potential to appreciate. Landauer ( LDR) offers personnel radiation monitoring to measure the dosage of x-rays, gamma radiation and other penetrating ionizing radiation to which a person has been exposed. We have rated Landauer buy since November 2001. The company's second fiscal-quarter revenue increased 5% year over year to $25 million as net income and earnings per share fell 16% to $5 million and 58 cents, respectively. Gross, operating and net margin declined 397, 14 and 532 basis points to 72%, 42% and 22%, respectively. Return on assets improved 25 basis points to 19% and return on equity increased 187 basis points to 33%. The company has no debt or interest expenses and a quick ratio of 1.86 indicates ample liquidity. Shares of Landauer have fallen 15% in 2009, underperforming the Dow Jones Industrial Average and the S&P 500. But at its current share price, the stock offers a 3.36% dividend yield, which is higher than the S&P 500 average of 3.14%. The stock trades at a price-to-earnings ratio around 25. Strayer Education ( STRA) is a for-profit post-secondary education company that offers a variety of academic programs through Strayer University. We have rated Strayer buy since March 2003.
Fiscal first-quarter revenue increased 28% year over year to $125 million as net income jumped 24% to $29 million and earnings per share improved 26% to $2.07. Gross and operating margin improved 128 and 162 basis points to 71% and 38%, respectively, as net margin fell 89 basis points to 23%. Return on assets climbed 505 basis points to 28% and return on equity ascended 1,692 basis points to 60%. Strayer has no debt and a quick ratio of 1.47, indicating an ideal financial position. Shares of Strayer have fallen 1% in 2009, outperforming the Dow Jones Industrial Average and underperforming the S&P 500. The stock is trading at a price-to-earnings ratio of 35. A 1% dividend yield sweetens the stock, but is below the S&P 500 average. New Jersey Resources ( NJR) is an energy services company that provides retail and wholesale energy services to customers in New Jersey and other states from the Gulf Coast to New England and Canada. We have rated New Jersey Resources buy since September 2002. The company's second fiscal quarter revenue declined 20% to $938 million as net income and earnings per share surged 183% to $36 million and 83 cents, respectively. Margins improved significantly during the quarter, with gross margin rising 442 basis points to 7%, operating margin climbing 443 basis points to 6.2% and net margin jumping 272 basis points to 3.8%. Return on assets increased 292 basis points to 4.9% and return on equity ascended 513 basis points to 16%. The debt-to-equity ratio remained low at 0.63, but a quick ratio of .43 indicates a weak cash position.
Shares of New Jersey Resources have fallen 4% in 2009, underperforming the Dow Jones Industrial Average and S&P 500. The stock trades at a price to earnings ratio of 14 and offers an attractive 3.28% dividend yield. National Presto Industries ( NPK) manufactures small appliances, defense products and absorbent products. We have rated National Presto Industries buy since June 2007. The company's fiscal first quarter revenue increased 40% year over year to $108 million as net income and earnings per share ascended 74% to $11 million and $1.58, respectively. Gross, operating and net margin improved 65, 307 and 195 basis points to 20%, 14% and 10%, respectively. Return on assets jumped 209 basis points to 14% and return on equity increased 254 basis points to 17%. The company has no debt or interest expenses and abundant cash reserves, as reflected by a quick ratio of 3.57. Shares of National Presto Industries are flat in 2009, outperforming the Dow Jones Industrial Average and underperforming the S&P 500. The stock trades at a price-to-earnings ratio of just 11 and offers a meager 1.3% dividend yield. Quality Systems ( QSII) develops and markets healthcare information systems that automate medical and dental practices and networks of practices. We have rated Quality Systems buy since November 2001. The company's fiscal fourth quarter revenue ascended 28% year over year to $66 million as net income inched up 1% to $11.40 million and earnings per share fell 2% to 40 cents. Gross margin shed 447 basis points to 63% as operating margin fell 521 basis points to 28% and net margin declined 470 basis points to 17%. Return on assets fell 228 basis points to 19% and return on equity declined 560 basis points to 30% on a higher base. The company has no debt or interest expenses and a strong cash balance, as indicated by a quick ratio of 2.1.
Shares of Quality Systems have climbed 30% in 2009, outperforming all major U.S. indexes. The stock trades at a price-to-earnings ratio of 35 and offers a dividend yield of 2.1%. TSC Ratings was recently given an award for "Best Stock Selection" amongst independent research providers by BNY ConvergEx Group. To see how your portfolio can utilize our research, click here. A rating can be viewed for any stock through our screener stock rating screener. Each rating is derived from a variety of fundamental and pricing figures and represents our opinion of risk-adjusted performance relative to a 5,000+ stock coverage universe. However, the rating does not incorporate all factors that can alter a stock's performance, such as corporate or industry events, technology innovations and shifts in competitive dynamics.