Stock Quotes in this Article: AAPL, GA, NVEC, WTSLA, BIRT

NEW YORK (Scott's Investments) -- Each month I update a fundamental/technical screen at Scott's Investments and track the results real-time. July's list of 18 stocks is here and the top 10 rated stocks returned an average of -6.54 vs. -11.03% for SPY. The entire list of stocks last month returned an average of -9.94%.

The screen looks for the following:

  • earnings growers still reasonably priced as judged by the PEG ratio
  • low debt
  • a history of high return on equity and investment, and
  • price momentum as gauged by the percentage the stock is trading to its 250 day high

The stocks are then ranked based on fundamental factors as compiled by stockscreen123.

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    A mere five stocks qualify for this month's list. The market selloff and volatility in August has trimmed the number of stocks trading near 52-week highs. Apple (AAPL) is number one on this month's list, despite the resignation of Steve Jobs. The company has no debt, a PEG ratio of .73, and ROE of 41.99%. The Jobs resignation could take time to affect the material operations of Apple. It is too early to say if it will have any significant material impact, so until the numbers and momentum say otherwise, Apple remains on the top of this month's list.

     

    Wet Seal (WTSLA), an apparel store for women, is a repeat stock on this list. The company bounced off its 200-day moving average after its second-quarter earnings report. It was highlighted by:

    • Net sales were $148.8 million compared to net sales of $131.5 million for the prior year second quarter.
    • Net income was $2.2 million, or $0.02 per diluted share, as compared to $1.6 million, or $0.02 per diluted share, in the prior year quarter. Excluding the after-tax effect of the non-cash asset impairment charges, net income would have been $2.8 million, or $0.03 per diluted share, in the current year quarter, and would have been $2.2 million, or $0.02 per diluted share, in the prior year quarter.
    • The Company generated cash flows from operations of $9.5 million during the second quarter, and ended the quarter with $147.8 million of cash, cash equivalents and short-term investments, and no debt.
    • For the third quarter of fiscal 2011, earnings are estimated in the range of $0.05 to $0.06 per diluted share.

     

    From a technical perspective, it is not difficult to see some key resistance levels to watch. If the stock can break the low $5s, it would be a bullish sign. It looks to be forming a triple top if it cannot break this level. The longer the stock waits to break this level, the more bullish a breakout above the level becomes:

    Below is the complete list of all five stocks. Giant Interactive (GA) has an interesting technical setup as well, as I posted on Stocktwits:

    Ticker Name Options Rank Mkt Cap PEGLT Dbt Tot2 EqQ ROE% 5YAvg

    AAPL Apple Inc. Here 94.28 355613.5 0.66 0 31.92

    BIRT Actuate Corporation Here 92.62 299.61 0.64 0 18.35

    WTSLA The Wet Seal, Inc. Here 78.48 503.62 0.91 0 15.16

    NVEC NVE Corporation Here 64.59 300.95 0.79 0 24

    GA Giant Interactive Group Inc (ADR) Here 39.89 1954.94 0.93 0 19.8

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    >>6 Core-Income Bargains

    >>5 Speculative High-Income Stocks

    >>3 Top-Yielding Ethanol Stocks

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    At the time of publication, author had no positions in stocks mentioned.

    Scott's Investments focuses on consolidating and tracking free online investment resources for the public with an emphasis on ETFs, portfolio/trading strategies and macroeconomics. Follow Scott's Investments on Stocktwits Twitter.