46 Bellwethers on the Move

There is no doubt the upcoming first-quarter earnings announcement season is going to separate the wheat from the chaff. As I mentioned last week, the analyst community expects the average S&P 500 company to post just 1.5% earnings growth in the first quarter. And earnings estimates for S&P 500 companies have been cut by 3.6% in the past month, while the Russell 1000 Growth and Value indices have seen earnings estimates cut by 8.4% and 7.1%, respectively.

Meanwhile, most of the high-quality stocks in my Blue Chip Growth letter have gone the other direction. Our average Blue Chip Growth stock, which is characterized by strong fundamentals and supported by solid buying pressure, has had its earnings revised 1.1% higher in the past month. So there is growing rift between superior A- and B-rated stocks and those that receive C-, D- and F-ratings week in and week out. And as we head into first-quarter earnings season and the thinner summer months, you can bet that it is only going to get wider.

That being said, it’s in our best interest to check Portfolio Grader rankings every week and take note of any changes. So let’s look at the 46 big blue chips that have been upgraded and downgraded this weekend. After taking a close look at the latest data on institutional buying pressure and each company’s fundamental health, I decided to revise my Portfolio Grader recommendations for each of the stocks listed below.


Last Week’s Holds, Now Buys

Symbol Company Name Quantitative Grade Fundamental Grade
AGN Allergan Inc. B C
AZN AstraZeneca PLC ADS B C
EPD Enterprise Products Partners L.P. B C
GE General Electric Co. B C
GGP General Growth Properties Inc. B C
IX Orix Corp. ADS B C
RAI Reynolds American Inc. B C
VRX Valeant Pharmaceuticals International Inc. B C

Last Week’s Sells, Now Holds

Symbol Company Name Quantitative Grade Fundamental Grade
AUY Yamana Gold Inc. C C
BBBY Bed Bath & Beyond Inc. D B
CNCO Cencosud SA ADR D B
DLTR Dollar Tree Inc. D B
ENI Enersis S.A. ADS D C
FTI FMC Technologies Inc. D C
LO Lorillard Inc. D C
MU Micron Technology Inc. C C
OKS ONEOK Partners L.P. C D
SWN Southwestern Energy Co. C D
XOM Exxon Mobil Corp. D B


Last Week’s Buys, Now Holds

Symbol Company Name Quantitative Grade Fundamental Grade
ACN Accenture PLC C C
AMZN Amazon.com Inc. B D
CAH Cardinal Health Inc. D B
ERIC Ericsson ADR C C
GS Goldman Sachs Group Inc. C A
KORS Michael Kors Holdings Ltd. C A
NMR Nomura Holdings Inc. ADS B C
OMC Omnicom Group Inc. C B
ORCL Oracle Corp. C B
ORLY O’Reilly Automotive Inc. C B
RTN Raytheon Co. C C
WDC Western Digital Corp. C B

Last Week’s Holds, Now Sells

Symbol Company Name Quantitative Grade Fundamental Grade
ALXN Alexion Pharmaceuticals Inc. D B
BG Bunge Ltd. C D
CF CF Industries Holdings Inc. D B
CME CME Group Inc. Cl A C D
EC Ecopetrol S.A. ADR D C
ETR Entergy Corp. D C
FRX Forest Laboratories Inc. C D
HOT Starwood Hotels & Resorts Worldwide Inc. D C
MS Morgan Stanley D C
PCLN priceline.com Inc. D B
PNC PNC Financial Services Group Inc. D C
VOD Vodafone Group PLC ADS D C
YUM Yum! Brands Inc. D C


Louis Navellier

Louis Navellier

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