Recreation Stocks for the Fourth of July

NEW YORK ( TheStreet) -- The Fourth of July holiday almost always includes a family picnic. In my earlier post today, I profiled seven alcoholic beverage stocks that accompany an adult picnic. A holiday also often includes recreational activities, either at the party or before.

The leisure and recreation products industry is in the consumer-discretionary sector, but to many of us, these companies provide products and services we feel we must have in our everyday lives. The consumer-discretionary sector is 16.1% overvalued with the leisure and recreation products industry 31.6% overvalued.

In my article on Tuesday, I gave the consumer-discretionary sector an equal-weight rating, and today I provide buy-and-trade profiles for five stocks in the recreation industry.

Among the five recreation stocks I profile today, one is undervalued and four are overvalued. All have hold ratings according to ValuEngine. All had gains over the last 12 months between 13.7% and 47.6%. All are projected to move sideways to down over the next 12 months. Two have 12-month trailing price-to-earnings ratios above 20.

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.

Brunswick ( BC) ($32.80) set a multiyear high at $37.37 on Feb. 15 and then held its 200-day simple moving average at $30.01 on June 21. Before any family picnic, you may be on a lake or at the beach with a boat made by Brunswick, or at the gym using fitness equipment. If it's raining, you may want to go bowling at a local Brunswick Bowling Center. My quarterly value level is $30.69 with a semiannual pivot at $33.55 and semiannual risky level at $39.56. The weekly pivot was tested on Tuesday.

Calloway Golf ( ELY) ($6.72) set a multiyear high at $7.30 on Feb. 11, and then tested and held its 200-day SMA since mid-April when this average was $6.28. When I lived on Long Island, I liked to play a round of golf in the early morning of July 4th. Although I do not use Calloway golf clubs or balls, this brand is very popular at country clubs. As long as I made it home in time for the family picnic, all was well in my household. My annual value level is $6.30 with a weekly pivot at $6.56 and monthly risky level at $7.84.

Polaris Industries ( PII) ($96.03) set a multiyear high at $97.95 on June 19. Back at the beginning of May the stock held its 200-day SMA, and then at $82.88. On eastern Long Island, a popular recreational activity is driving on off-road or all-terrain vehicles. Polaris makes these vehicles and the helmets and apparel that go along with the ride. My quarterly value level is $71.48 with a monthly pivot at $94.97 and weekly risky level at $101.74.

Pool Corp ( POOL) ($53.84) set a multiyear high at $54.88 on June 18. If you own a swimming pool, perhaps it was built using materials from Pool Corp. Pool also provides maintenance products and services to keep your pool in tip-top shape for your Fourth of July party and family picnic. My semiannual value level is $52.56 with a monthly pivot at $53.28 and weekly risky level at $54.07, which was tested on Tuesday.

Sturm Ruger ( RGR) ($47.23) has been moving sideways to down since setting a multiyear high at $60.11 on Nov. 30. If you go to a rifle range for skeet shooting, traps or sporting clay, perhaps you will use a rifle made by this company. It also makes hunting rifles and pistols for target practice. My annual value level is $30.99 with a semiannual level at $47.53 and a semiannual risky level at $48.97.

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 has an engineering degree from Georgia Tech and a master of science from Brooklyn Poly. He began his career in the financial services industry in 1972 trading U.S. Treasury securities in the primary dealer community. In 1981 he formed the Government Bond Department at LF Rothschild and helped establish that firm as a primary dealer in 1986. Richard began writing market research in 1984 and held positions as market strategist at firms such as Smith Barney, William R Hough, Joseph Stevens, and Rightside Advisors. He joined www.ValuEngine.com in 2008 producing newsletters covering the U.S. capital markets, and a universe of more than 7,000 stocks. Richard employs a "buy and trade" investment strategy and can be reached at RSuttmeier@Gmail.com.