Just What the Doctor Ordered

Over the last few weeks, I’ve been asked over and over what kinds of screens I’m running.

Well, aside from the many screening strategies that I always run (because they work), I have been running a new one. It has put some awesome new picks on my radar screen.

This screen isn’t a trading strategy per se’, but rather a screen to help me identify which sector and industry (and therefore stocks) held up the best in this recent sell-off.

That sector is the Medical Sector.

The idea behind this screen is that the ones showing the greatest resiliency should be the ones that will breakout first.

Parameters:

The screen starts out with the usual items:

Price >= 5

Volume (Avg. 20 Days) >= 100,000

Then I specifically screen for the Sector with the greatest Relative Price Change over the last 4 weeks. Basically, I’m looking for the sector that performed the best, on average, in comparison to the S&P 500.

From there, I narrow that sector down to only those stocks with a Zacks #1 Rank or Zacks #2 Rank. (The Zacks Rank is one of the best rating systems out there, so this automatically puts the odds in my favor.)

For good measure, I also make sure the stocks have Positive Earnings Estimate Revisions over the last 4 weeks for both Q(1) and F(1). (Studies show that stocks with Rising Earnings Estimates outperform the market.)

Then I narrow that list down even further by looking for the Top 20 stocks within the Top Sector based on the Relative % Change in Price over 4 Weeks. (First I looked for the Best Sector based on the Average % Change in Price over four Weeks. Then I zeroed in on the best 20 stocks within that sector.)

Lastly, I cull it down to the Top 10 stocks within that Sector’s Medium-Sized Industry.

This screen this week produced 20 stocks.

Again, the best Sector was Medical.

And the Top Medium-Sized Industries within that Sector are:

Drugs
Medical Care
and Medical Products

This screen has produced a lot of exciting new picks.

Instead of the usual three stocks I highlight in this article, here are five new top picks:

ARTC - Analyst Report Arthrocare Corp.
Medical device co. that develops, manufactures and markets products based on its Coblation technology. The company’s strategy includes applying its patented technology for soft-tissue surgery for arthroscopic, cosmetic, spinal neurosurgery and more.

ERES - Snapshot Report eResearch Technology Inc.
Provider of integrated software apps. and technology consulting services to the pharma., biotech. and medical device industries.

IVGN Invitrogen Corp.
Provides products and services that support academic and government research institutions and pharma. and biotech companies worldwide by providing essential life science technologies for disease research, drug discovery and commercial bioproduction.

MDCI - Snapshot Report Medical Action Industries, Inc.
Develops, manufactures, markets and distributes a variety of disposable surgical related products.

TECH - Snapshot Report Techne Corp.
Holding company which has two wholly-owned operating subsidiaries: Research and Diagnostic Systems, Inc. and R&D Systems Europe Ltd. Its two main operating segments are hematology controls and biotechnology products.

You can open this screen up to look for the top two sectors, the top three sectors, the top five sectors or whatever you choose.

Many screeners won’t let you screen for the Top Sectors or Industries. But in the Research Wizard you can. Now you can find the top Sectors based on whatever metric you like and then drill down to the best Industries and then on to the best Stocks.

Picking winning stocks has never been so easy.

And now you can do it too.

Sign up for your two-week FREE trial to the Research Wizard. Remember the key to successful screening is in discovering those screens that have produced profitable results in the past. That’s exactly what you get with the powerful Screening and Backtesting ability of Research Wizard. You can do it. Try it today for free.

Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.