• Subscribe
  • Log In
  • Home
  • Daily Diary
  • Asset Class
    • U.S. Equity
    • Fixed Income
    • Global Equity
    • Commodities
    • Currencies
  • Sector
    • Basic Materials
    • Consumer Discretionary
    • Consumer Staples
    • Energy
    • Financial Services
    • Healthcare
    • Industrials
    • Real Estate
    • Technology
    • Telecom Services
    • Transportation
    • Utilities
  • Latest
    • Articles
    • Video
    • Columnist Conversations
    • Best Ideas
    • Stock of the Day
  • Street Notes
  • Authors
    • Bruce Kamich
    • Doug Kass
    • Jim "Rev Shark" DePorre
    • Helene Meisler
    • Jonathan Heller
    • - See All -
  • Options
  • RMPIA
  • Switch Product
    • Action Alerts PLUS
    • Quant Ratings
    • Real Money
    • Real Money Pro
    • Retirement
    • Stocks Under $10
    • TheStreet
    • Top Stocks
    • Trifecta Stocks
  1. Home
  2. / Investing
  3. / Technology

Finding Movers Among the Mid-Caps

These three mid-caps have solid fundamentals, and they're outpacing their peers.
By KATE STALTER Nov 18, 2011 | 04:16 PM EST
Stocks quotes in this article: KSU, PNRA, NUAN

Dividend-paying large-caps have been in the spotlight lately, as many investors view those equities as a good place to bide time amid market volatility.

However, when it comes to price appreciation, there have been some outstanding performers emerging from the ranks of mid-caps. The S&P 400 mid-cap index doesn't really reflect overall strength -- it has had a month-to-date decline of 2.8% as of Friday -- but some individual mid-cap names are racing ahead of the pack.

Prior to the summer's downturn in the general market, railroad stocks had been price leaders. Since rebounding on Oct. 4, S&P 400 component Kansas City Southern (KSU) has chugged 31% higher.

Revenue growth has accelerated in the past couple of quarters, and earnings, though down from triple-digit growth levels last year, rose 29% or more in the past three quarters.

The stock has a market cap of about $7.3 billion, and it moves 1.3 million shares a day, a decent level of liquidity. Recent upside volume has been good as the stock trended higher, with a couple of weeks of above-average turnover as the price increased.

Kansas City Southern has moved beyond its latest technical buy point, but it could offer another opportunity after its next pullback.

Another mid-cap showing solid price gains with good fundamentals is Panera Bread (PNRA). After the company announced a better-than-expected fourth-quarter outlook, the stock bolted 15.5% on Oct. 26 on more than four times average volume.

The pace of same-store sales has picked up, with company-wide revenue growth accelerating in the past two quarters. Profit growth has been 21% or higher in the past four quarters.

The stock has held its gains since the Oct. 26 leap, and it is currently perched at its 20-day moving average. Volume has come in below average during that time, a good sign as the stock takes a breather, meaning there's not a lot of churn going on that could reflect investor indecision. Recent price and volume action suggests that buyers are satisfied with holding the stock at this price before jumping in with fresh purchases.

Panera's market capitalization is nearly $4 billion, and it moves about 587,000 shares a day. That's thinner trade than you'll see in many of its larger-cap peers.

From the tech sector comes Nuance Communications (NUAN), which is pulling back this month after gaining 9.6% in September and 30.2% in October.

The company's speech-recognition software is used in numerous industries, including medical and automotive.

Nuance has a market cap of nearly $7.4 billion, and it trades more than 4.7 million shares a day, better volume than many companies of similar size.

After those big price moves in the past couple of months, Nuance is forming a new consolidation. Its most recent price correction was bullish, as its August low of $15.56 undercut the trough of the prior base. New intermediate lows often clear the way for new money to swoop in, grabbing shares at bargain prices.

I'll be eyeing this current consolidation closely, to see when the stock begins notching heavy-volume gains again.

Wall Street expects profit growth of 13% for this year, to $1.35 per share. Income is expected to rise another 19% in 2012, to $1.60 a share.

The company reports its fourth quarter on Tuesday, and Wall Street expects profit of $0.42 a share, a year-over-year quarterly gain of 27%. As always, the company's outlook or indications of growth rates and margins could have a big impact on the price, post-earnings, so that's something to keep an eye on.

Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.

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

TAGS: Investing | U.S. Equity | Consumer Discretionary | Technology

More from Technology

The Charts Point to More Selling Ahead for 4 Former Tech Leaders

Ed Ponsi
Jul 1, 2022 10:00 AM EDT

Keep in mind that no matter how much a stock has fallen, it can always go lower, and it appears these four stocks could prove that point.

Want to Save Your Retirement Fund? Tune Out the Talking Heads

Jim Collins
Jun 30, 2022 3:14 PM EDT

The first half of this year has been ugly. But we could have seen what would happen to Netflix, Tesla and Meta...

Is Pinterest's CEO Change Good News? It Depends on How You Look at It

Eric Jhonsa
Jun 30, 2022 2:30 PM EDT

Plus, why a report about an Apple 5G modem setback sounds believable.

Barring a Major Recession, Some Chip Stocks Look Very Cheap Right Now

Eric Jhonsa
Jun 30, 2022 11:45 AM EDT

Many quality chip stocks now seem to be pricing in a massive downturn, rather than just a typical down-cycle.

Oracle Continues to Struggle to Make a Durable Low

Bruce Kamich
Jun 30, 2022 8:20 AM EDT

Let's review the charts and indicators.

Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation. If you have questions, please contact us here.

Email

CANCEL
SUBMIT

Email sent

Thank you, your email to has been sent successfully.

DONE

Oops!

We're sorry. There was a problem trying to send your email to .
Please contact customer support to let us know.

DONE

Please Join or Log In to Email Our Authors.

Email Real Money's Wall Street Pros for further analysis and insight

Already a Subscriber? Login

Columnist Conversation

  • 09:49 AM EDT JAMES "REV SHARK" DEPORRE

    This Weekend on Real Money

    Stop Wishing, Hoping, and Praying and Take Control...
  • 07:59 PM EDT PAUL PRICE

    Very Good Quarterly Numbers From Bassett Furniture (BSET)

    Bassett Furniture blew right through analysts es...
  • 04:41 PM EDT PAUL PRICE

    First-Half Results - Putrid; Second Half Results - Likely to Be Much Better

    It's great that we're done with June. 2022 mark...
  • See More

COLUMNIST TWEETS

  • A Twitter List by realmoney
About Privacy Terms of Use

© 1996-2022 TheStreet, Inc., 225 Liberty Street, 27th Floor, New York, NY 10281

Need Help? Contact Customer Service

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data & Company fundamental data provided by FactSet. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by FactSet Digital Solutions Group.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

FactSet calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.

Compare Brokers

Please Join or Log In to manage and receive alerts.

Follow Real Money's Wall Street Pros to receive real-time investing alerts

Already a Subscriber? Login