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50 Ways to Make Market Swings Work For You

Updating our buy and sell list for investors

   

We’re only a few weeks into first-quarter earnings season and already the analyst community has slashed their overall earnings estimates: The average S&P 500 company is now expected to post a slight dip in earnings. This, and the fact that the seasonal pension funding season is over, has given some in the “sell in May and go away” crowd an excuse to flee the market. So the “bad news” is that the market is now officially oversold.

We knew this was coming, but if the recent bumpiness has you nervous, you can keep this in mind. First, as I mentioned earlier, if history repeats itself, Wall Street will likely bounce around over the next few weeks before firming up sometime next month. So this near-term bumpiness presents some tantalizing buying opportunities.

First, high-yield stocks are looking more attractive by the hour. With the average S&P 500 stock yielding nearly 2.1%, the stock market is much better than you can get through most savings accounts. When chasing yields, just be sure to do your homework and screen dividend stocks for fundamental health.

The other opportunity is in companies that are surprising Wall Street with their first quarter sales and earnings results. You can use Portfolio Grader to get a sense of which companies are likely to beat estimates; take note of how a company scores in terms of “Analyst Earnings Revisions” and “Earnings Surprises.”

Even though the stock market might be oscillating day to day, volatility is now moderating and I suspect that we can use these daily oscillations to step up and buy these premium stocks. But before you buy, let’s look at the 50 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.

Upgrades

Last Week’s Holds, Now Buys

Symbol Company Name Quantitative Grade Fundamental Grade
AFL AFLAC B B
APH Amphenol B B
BBVA Banco Bilbao Vizcaya Argentaria B B
BEAM Beam In B B
BRFS BRF SA ADR B B
DISH DISH Network B D
ETR Entergy B C
KO Coca-Cola B C
MA MasterCard C B
SNDK SanDisk B C
TSM Taiwan Semiconductor Manufacturing B B
VIP VimpelCom B B
VRTX Vertex Pharmaceuticals A F
VRX Valeant Pharmaceuticals B C

Last Week’s Sells, Now Holds

Symbol Company Name Quantitative Grade Fundamental Grade
BBBY Bed Bath & Beyond D B
CMG Chipotle Mexican Grill D B
CRM salesforce.com D C
EL Estee Lauder D B
EXC Exelon C D
INFY Infosys D C
MJN Mead Johnson D B
RBS Royal Bank of Scotland C D
SAN Banco Santander C D
SBUX Starbucks D B
VIV Telefonica Brasil D C

Downgrades

Last Week’s Buys, Now Holds

Symbol Company Name Quantitative Grade Fundamental Grade
BAP Credicorp C B
BTI British American Tobacco C B
CTRX Catamaran C C
CX Cemex SAB B C
GE General Electric C C
GPC Genuine Parts C C
MTB M&T Bank C B
STX Seagate Technology C B
TWC Time Warner Cable C B

Last Week’s Holds, Now Sells

Symbol Company Name Quantitative Grade Fundamental Grade
ABB ABB D C
BXP Boston Properties D D
EOG EOG Resources D D
EQR Equity Residential D C
ESV Ensco PLC D C
FDX FedEx D C
FTI FMC Technologies D C
HAL Halliburton D C
HOG Harley-Davidson D C
IBM International Business Machines F B
L Loews D D
NSC Norfolk Southern D D
DROK Rockwell Automation D C
USB U.S. Bancorp D C
XOM Exxon Mobil D B

Article printed from InvestorPlace Media, http://investorplace.com/2013/04/50-ways-to-make-market-swings-work-for-you-ibm-ko-ge-afl-ap/.

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