Small- and mid-cap stocks (SMID) have underperformed large-caps over the past 12 months, but may be in a better position to generate market-beating returns going forward. For one thing, SMID companies tend to focus on domestic markets, so their businesses could be less disrupted by the fallout from unrest in the Middle East, the Russian invasion of Ukraine, events related to China, or other geopolitical developments. As well, the prices of SMID stocks generally are lower than the prices of large-caps, with the P/E ratio on the Russell 2000 Small-Cap Index of 13 compared to a trailing P/E of 25 for the S&P 500. Finally, there are long stretches in the record books when SMID stocks have outperformed large-caps. From 2003-2021, for example, the Russell 2000 Index had climbed 450%, compared to an advance of 330% for the S&P 500 index. Here are the stocks with market caps below $20 billion that are on the Argus BUY list and recently were added to Argus' Mid-Cap Theme Model Portfolio.

The stock market fell back a bit on Friday, with the impact most notable on the likes of the Nasdaq Composite index, semiconductor chipmakers, and recently high-flying stocks such as Nvidia. Time will tell if this is the beginning of a reset for stocks, but this one-day action aligns with recent insider-sentiment data from Vickers Stock Research. Indeed, for more than a month, that data has clearly suggested that corporate executives, directors, and beneficial owners as a group have become increasingly defensive while stocks pushed higher day after day after day. That is unchanged this week.

Stocks are higher at midday, this after weakness earlier in the session that was mostly the result of disappointing guidance from the likes of Intel and KLA Corp. That said, December's headline Personal Consumption Expenditures price index appears to have resonated with investors who seem to be increasingly of the opinion that the Fed has indeed set the stage for a soft landing of the U.S. economy. PCE rose 0.2%, following a 0.1% decline in November and leaving annual PCE unchanged at 2.6%. Core PCE also rose 0.2%, up from 0.1% in November and bringing the annual rate to 2.9% from 3.0% last month. Elsewhere, Personal Spending rose 0.7%, which was higher than the expected increase of 0.5%. Personal Income drifted lower, rising 0.3% to match expectations but down from 0.4% in November. As well, solid earnings from American Express and Colgate-Palmolive are adding to a positive mood as the trading week draws to a close.

Stocks rose on Monday morning, led by the Communication Services and Financial sectors, as investors awaited the Fed's next interest rate decision and the October employment report later this week. On the earnings front, McDonald's shares rose after the company posted stronger-than-expected third-quarter sales and earnings. The Dow rose 1.0%, the S&P 0.6%, and the Nasdaq 0.7%. Crude oil fell sharply to $82.50 per barrel while gold rose $12 to trade near $2010 per ounce.

Stocks edged higher on Monday morning as investors awaited earnings from Apple and Amazon, and the July employment report later this week. With about half of S&P 500 companies having reported, FactSet said that 2Q23 earnings were down 7.3% from the prior year, the sharpest decline since 2Q20. However, some 80% of reporting companies have beaten expectations, above the five-year average of 78%. The Dow rose 0.2%, the S&P 0.1%, and the Nasdaq 0.3%. Crude oil rose nearly 1% to $81 per barrel while gold traded near $2006 per ounce.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

Stocks rallied on Thursday as investors weighed strong earnings from Meta Platforms and new GDP and employment data. The Commerce Department said that the U.S. economy expanded at a 1.1% rate in 1Q, helped by strong consumer spending but hurt by weak business investment. Meanwhile, employment data pointed to a still tight labor market. First-time claims for state unemployment benefits fell by 16,000 to a seasonally adjusted 230,000 for the week ended April 22, below the consensus forecast of 248,000. Meta shares jumped after strong first-quarter results, reaching their highest levels since January 2022. Amazon also reported stronger-than-expected sales and earnings after the close, sending the shares up in after-hours trading. The Dow rose 1.57%, the S&P 1.96%, and the Nasdaq 2.43%. Crude oil traded near $75 per barrel, while gold rose slightly to $1997 per ounce.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

Monday Tee Up: Data Hat Trick Includes the Fed, Jobs, and Earnings

Monday Tee Up: The Fed, Jobs, Earnings Roll On

Monday Tee-Up: Housing, Consumers, Manufacturing

onday Tee-Up: Housing, Consumers, Manufacturing

The CEO of Marriott thinks it is going to be a "blockbuster" summer. Hotel bookings are up. Airfares are up (both pricewise and for bookings). As well, U.S. hotel profitability is above pre-pandemic levels for the second consecutive month, according to Smith Travel Research, and the key metrics used to judge hotel performance are higher than in the comparable period in 2019. The most-recent Average Daily Rate (ADR) measured against a range of hotel properties is $151.73, up 22% compared to the same period in 2019. Revenue per available room, or RevPAR, is $100.97, up 26%. Travel experts say that reservations are strong because of pent-up demand. Consumers are anxious to vacation and visit friends and family after two years of restrictions. Business travel also is starting to perk back up as companies are eager to see clients in-person again. We are living in a new inflationary economic environment, but consumers so far are willing to spend on leisure activities. Here are some of Argus' BUY-rated travel companies, with a few airlines, a few big hotels, and some online booking agencies. Some are these stocks are included in our model portfolios (Growth & Income, Equity Income, Growth, and Institutional).

Stocks pared early losses on Tuesday morning, helped by gains in the Communication Services and Consumer Discretionary sectors. Federal Reserve Governor Christopher Waller said that the central bank needed to raise interest rates by 50 basis points at every meeting 'until we see substantial reductions' in inflation. Meanwhile, Fed Chair Jerome Powell prepared to meet with President Biden and Treasury Secretary Janet Yellen at the White House for a discussion about the economy. The Conference Board said that its consumer confidence index slipped to 106.4 in May from 108.6 in April. The Dow fell 0.1%, the S&P fell 0.1%, and the Nasdaq rose 0.3%. Crude oil traded near $117 per barrel, while gold fell $11 to $1846 per ounce.

Stocks have struggled this year, with the S&P 500 now down over 12% (excluding dividends) so far in 2022. But not every stock has tumbled. Our analysts have been working through earnings season and have come across several stocks in Argus coverage that have approached target prices. We set target prices through our valuation framework, which includes analysis of historical multiples, peer multiples, and future dividends and cash flows. After adjusting the models for the latest earnings and dividend information -- most of which has been good -- here are some of the stocks for which we have raised target prices over the past month. All of the following stocks are rated BUY at Argus.

Stocks fell sharply on Friday morning, reversing much of Thursday's rally. Amazon shares dropped more than 12% after the company posted a first-quarter loss and issued disappointing guidance for the current quarter. Apple shares also fell, despite strong fiscal 2Q results, after the company warned that supply-chain constraints would weigh on revenue in 3Q. The Dow fell 1.2%, the S&P 1.8%, and the Nasdaq 2.1%. Crude oil rose to $108 per barrel, while gold traded near $1915 per ounce.

Stocks fell sharply on Friday morning, a day after Fed Chair Jerome Powell said that a 50-basis-point rate hike would be 'on the table' in May. The comments contributed to a sharp afternoon selloff on Thursday. On the earnings front, American Express shares fell despite stronger-than-expected 1Q earnings, as the company did not raise its full-year guidance. Verizon shares also fell after the company said that 2022 earnings would come in toward the low end of its previous guidance range. The Dow fell 1.4%, the S&P 1.2%, and the Nasdaq 0.8%. Crude oil fell to $102 per barrel, while gold traded near $1929 per ounce.

The Insider Index from Vickers Stock Research continues to reflect improving sentiment, having recently moved into the neutral zone (from bearish) for the first time since October 2020. As of this week, the index sits at -12.62, its strongest reading since September 2020. While only recently neutral, current sentiment from this long-term (six months) barometer is in stark contrast to the extremely bearish readings seen in early July 2021, when the index was at its most-bearish level since it was created in 1987. Elsewhere, the volume of insider transactions remains strong, with this being a third consecutive week of over 1,800 insider buy and sell orders that meet the criteria for inclusion in Vickers' Weekly Insider Report.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

Our rating on the Industrial sector is Over-Weight. After enduring the challenges of the pandemic, the cyclical stocks in the Industrial sector appear well-positioned within the changing political environment. Specifically, we believe that Industrial stocks will benefit from enhanced infrastructure investment and more-lenient trade policies during the Biden administration. The Industrial sector accounts for 8% of S&P 500 market capitalization. Over the past five years, the weighting has ranged from 7% to 12%. We think that investors should allocate 9%-10% of their diversified portfolios to the group. The sector includes industries such as transportation, aerospace & defense, heavy machinery, and electrical equipment. The sector is underperforming the market thus far in 2021, with a gain of 13.5%. It also underperformed in 2020, with a gain of 9.0%, and slightly underperformed in 2019, with a gain of 26.8%. Here are some of our top picks, all of which are rated BUY at Argus.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

This edition features the U.S. gas market; the recovering airline industry; new coverage of equipment rental firms; and notes from Meta Platforms (better known as Facebook), Apple, and Amazon.

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

Stocks finished mostly higher on Thursday as investors weighed earnings reports from a range of major companies along with new employment data. First-time unemployment claims fell to 290,000, down from the prior week and below consensus. Continuing claims dropped to 2.481 million from 2.603 million a week earlier, and were also below the consensus forecast. Housing data was strong. The National Association of Realtors said that sales of existing homes rose 7% in September to a seasonally adjusted annual rate of 6.29 million, up from a decline of 2% in August and above the consensus estimate calling for 3.7% growth. The Dow fell 0.02%, the S&P rose 0.30%, and the Nasdaq rose 0.62%. Crude oil fell 1% to $82.50 per barrel, while gold fell slightly to $1784 per ounce.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

Stocks continued their rally on Friday morning amid strong earnings reports from American Express and Twitter. However, Intel shares fell more than 6%, despite solid second-quarter results, after the company projected declining gross margins over the remainder of the year. The Dow rose 0.5%, the S&P 0.8%, and the Nasdaq 0.8%. Crude oil traded near $72 per barrel, while gold fell $6 to $1799 per ounce.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

Stocks rose modestly on Monday morning at the start of a busy week for 1Q earnings reports, which have thus far been strong. According to FactSet, 84% of S&P 500 companies that have reported 1Q results have topped consensus expectations. On the economic front, the Commerce Department said that core capital goods orders excluding aircraft rose 0.9% in March, up from a 0.8% decline in February but below the Reuters consensus forecast of 1.5% growth. The Dow rose 0.1%, the S&P 0.2%, and the Nasdaq 0.6%. Crude oil traded near $62 per barrel, while gold rose slightly to $1778 per ounce.

Our rating on the Industrial sector is Over-Weight. After enduring the challenges of the pandemic, the cyclical stocks in the sector appear well positioned within the changing political environment. Specifically, we believe that Industrial stocks will benefit from enhanced infrastructure investment and more-lenient trade policies during the Biden administration. The Industrial sector accounts for 8.9% of S&P 500 market capitalization. Over the past five years, the weighting has ranged from 7% to 12%. We think that investors should allocate 9%-10% of their diversified portfolios to the group. The sector includes industries such as transportation, aerospace & defense, heavy machinery and electrical equipment. The sector is outperforming the market thus far in 2021. It underperformed in 2020, with a gain of 9.0%, and slightly underperformed in 2019, with a gain of 26.8%. Here are some of our top Industrial picks, all of which are rated BUY at Argus.

Argus has published its latest Portfolio Selector, which features its popular Focus List. Each month, Director of Research Jim Kelleher, CFA, surveys the team of Argus Research industry analysts for their timeliest recommendations out of the company's fundamental universe of approximately 500 stocks. The Focus List includes 30 stocks: turnover is high, as Director of Research Kelleher typically adds three or four new stocks per month. Below are the latest additions, all of which are rated BUY at Argus.

Breadth has been impressive so far this year, and every sector turned in a positive performance in 1Q21 -- though last year's laggards were generally the leaders. Take Energy, for example. The sector fell 37% in 2020 and lagged the market in 2019. This year, Energy is the leading sector, with a gain of 29%. The Financial Services sector also turned things around in 1Q, rebounding from a 4% slide in 2020 with a 15% advance so far in 2021. Other market-beating sectors in 2021 include Industrial (+11%, after underperforming the market last year), Materials (+9%), Real Estate (+8%) and Communication Services (+8%). The turnaround in sector performance hints at a shift in the market toward value investing and away from growth investing. Indeed, the three primary growth sectors -- Technology, Healthcare and Consumer Discretionary -- are barely in the black in 2021. Our sector Over-Weights reflect a blend of growth and value, and include Technology, Healthcare, Industrials, Financial Services and Communication Services.

The Portfolio Selector features the Argus Focus List, a group of 30 "best idea" stocks generated and regularly updated by Argus' analysts and investment policy committee. It also includes the director of research’s monthly investment strategy column, stock recommendations and sector picks, economic forecasts, and an asset allocation model. This month, the Focus List additions are Dell Technologies Inc (DELL); Weyerhaeuser Co. (WY); EBay Inc. (EBAY); Southwest Airlines Co (LUV) and the Focus List deletions are Williams-Sonoma, Inc. (WSM); Dominos Pizza Inc (DPZ); Texas Instruments Inc. (TXN); AGNC Investment Corp (AGNC).

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

This edition features an oil market update; Amazon's potential in Australia; revisiting our North American airline coverage; and notes from Maersk, Air Liquide, and Allstate.

The weekly seesaw that is insider sentiment has swung again, this week for the better after trending for the worse last week and for the better the week before that and for the worse... In our weekly review of insider-transaction data from Vickers' Stock Research, there is indeed week-over-week improvement -- but overall sentiment has done little for the past month or so and remains at a level that is clearly cautious.

With 2.5 months of 2021 in the books, let's see how U.S. markets are stacking up against foreign markets. In past comparisons, foreign markets have been lagging -- and in some cases, badly. The S&P SmallCap 600 is leading in 2021, with an almost 25% gain. No surprise, the Russell 2000 (IWM) is next, jumping 20%. The S&P 400 (MidCaps) has popped 16.5%, while the Dow Transports added 14%. This combination of strength is quite different from recent years.

Crude oil (both WTI and Brent) continues to recover from the devastating bear market in February and March of last year. WTI broke out of bull flag on February 1, and at the recent high on February 10, had jumped almost 12% in the past eight days to $58.68/barrel. That is the highest since January of last year. Brent crude is also up 12% over the eight-day period ending 2/10, reaching over $61/barrel, its highest level since last February.

January ended with a fizzle, as stocks recorded their worst month since October and the S&P 500 registered a loss for the month. In a month that featured the incursion at the Capitol Building and a heavily policed inauguration, few predicted that the key market driver would be a retail chain that a few hedge funds (to their misfortune) perceived to be on its last legs.

We saw some strange days late last year, and the majority of them had to do with the massive rotation that was happening at the time. But maybe we should start calling days like Thursday more the norm than wacky. As we said a few days ago, 2021 is starting out as the polar opposite of 2020 -- at least as far as the markets are concerned.

In the past few weeks, the S&P 500 has drifted down from its October closing high of 3,534 on 10/12/20, hit an end-of-day low of 3,427 on 10/19/20, and worked back up to 3,465 at the close on October 23. The market is down about 2% from that mid-October high but still up 3% for the month, coming off September's 4% decline.