Since 2010, our top scoring weekly has outpaced the SPX by a median 328 bps in the following year. The best performers from our list one year ago are AGN up 91%, MAR up 61%, and DPS up 54%.
The average large cap score is 69.22, above the four week moving average score of 68.91. The average large cap stock is trading -10.35% below its 52 week high, 3.72% above its 200 dma, has 4.17 days to cover held short, and is expected to grow EPS by 9.6% next year.
The best large cap sector is healthcare. Services, utilities, and industrial goods also score above average. Consumer goods, financials, and technology score in line. Basic materials score below average.
According to the Seasonal Investor, the Nasdaq 100 has a better track record for gains over the past decade during the first quarter than the DJ30 and the SP500. However, the SP500 has the highest median return, gaining 3.2% during the quarter.
The following table highlights the best first quarter performers across large cap. Each of these stocks has produced gains for investors in at least nine of the past 10 Q1s. Priceline and Universal Health have the added distinction of being the only two large cap stocks to have gained in all 10 of the past 10 years.
Source: Seasonal Investor Seasonal Investor
The top scoring industry across our large cap universe is department stores (M, KSS, TJX). Department stores typically benefit from seasonal tailwinds through the Q4 earnings reporting season. Drug stores (OCR, CVS, WAG) offer upside as reform driven script growth offset margin pressures from a rising percentage of less profitable gov't programs (Medicaid) and stubbornly strong generic prices. Healthcare plan (AET, ANTM, CI, HUM) membership growth (exchanges + Medicare + Medicaid) support revenue growth again in 2015. Plans expect to generate between 3% and 5% margin on exchange plans over time. Rising commercial plane production supports aerospace suppliers (TDG, HON) while budget clarity offers opportunity for defense contractors (RTN, COL, LMT). Wholesale drug (CAH, MCK) demand also benefits from reform driven script growth.
