WPI, SAI: S&P 500 Gainers

NEW YORK ( TheStreet) -- Watson Pharmaceuticals ( WPI) and SAIC ( SAI) were among the best-performing stocks in the S&P 500 on Wednesday.

The S&P 500 fell 2.63 points, or 0.19%, on Wednesday to 1,402.89.

Watson Pharmaceuticals shares increased 8.82% to $63.69 on heavy volume of nearly 11 million, more than five times the issue's trailing three-month daily average churn. The pharmaceutical company is reportedly in talks about buying Actavis, a Swiss generic drug manufacturer.

Watson shares trade at an estimated price-to-earnings ratio for next year of 10.4X; the average for pharmaceutical companies is 31.7X. For comparison, both Perrigo ( PRGO) and Hospira ( HSP) have higher forward P/Es of 18.9X and 13.5X, respectively.

Eighteen of the 25 analysts who cover Watson Pharmaceuticals rate it at buy; seven analysts give the stock a hold rating.

TheStreet Ratings gives Watson Pharmaceuticals a B+ grade with a buy rating and $76.90 price target. The stock has risen 5.55% year to date.

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Shares of SAIC rose 3.5% to close at $13.61 after the board of the McLean, Va.-based provider of technology and engineering applications declared an initial quarterly dividend of 12 cents a share, and approved plans to repurchase up to 40 million shares.

The company also reported its fourth-quarter results and forecast earnings from continuing operations of $1.26 to $1.36 a share on revenue ranging from $10.7 billion to $11.2 billion.

The stock was also raised to sector perform from underperform by analysts at RBC. The analysts' price target is $14.

SAIC shares currently trade at a forward P/E of 9.88X; the average for computer services companies is 23.82X. For comparison, both Equinix ( EQIX) and VeriSign ( VRSN) have higher forward P/Es of 39.64X and 16.9X, respectively.

Thirteen of the 16 analysts who cover SAIC rate it at hold. Two analysts give the stock a buy rating and one rates it at sell.

TheStreet Ratings gives SAIC a C grade and a hold rating. The stock has risen 10.74% year to date.


Other top-performing S&P stocks on Wednesday include:
  • Netflix (NFLX): The stock rose 4.42% Wednesday to $120.10. The stock has increased 73.33% year to date. TheStreet Ratings gives Netflix a C+ grade and hold rating.
  • Expeditors International of Washington (EXPD): The stock increased 3.73% Wednesday to $46.98. The stock has risen 14.7% year to date. TheStreet Ratings gives Expeditors International of Washington a B grade with a buy rating and $51.46 price target.
  • Masco (MAS): The stock rose 3.6% Wednesday to $14.10. The stock has increased 34.54% year to date. TheStreet Ratings gives Masco a C- grade and hold rating.
  • Best Buy (BBY): The stock increased 3.23% Wednesday to $27.14. The stock has risen 16.13% year to date. TheStreet Ratings gives Best Buy a C grade and hold rating.
  • GameStop (GME): The stock rose 2.75% Wednesday to $24.67. The stock has increased 2.24% year to date. TheStreet Ratings gives GameStop a B grade with a buy rating and $27.50 price target.
  • NRG Energy (NRG): The stock increased 2.67% Wednesday to $16.92. The stock has fallen 6.62% year to date. TheStreet Ratings gives NRG Energy a C grade and hold rating.
  • Sandisk (SNDK): The stock rose 2.66% Wednesday to $51.29. The stock has risen 4.23% year to date. TheStreet Ratings gives Sandisk a B grade with a buy rating and $57.40 price target.
  • Red Hat (RHT): The stock increased 2.64% to $52.03. The stock has increased 26.01% year to date. TheStreet Ratings gives Red Hat a B grade with a buy rating and $58.59 price target.

-- Written by Alexandra Zendrian in New York.

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