Monday's PowerRating Upgrades: ALE, PSYS, XRX

Everywhere I go, I am being asked if the stock market bottom is in. While the last 4 trading days definitely look like a bounce is taking place and it's very possible that the lows are in, no one really knows for sure.

There is unprecedented, historic volatility and market shaking surprises happening almost everyday. Although, I am feeling very bullish here, believing that the government intervention and the inherent nature of the stock market will soon usher in a resumption of the massive bull market, one can only tell in hindsight that the long term bottom is in place.

Long term stock investors need proven tools to keep their portfolio on the right side of the market with stocks that have the best odds of growth over the long horizon. Our Long Term PowerRatings are such a tool. The PowerRating method is based upon 12 years of extensive, statistically valid studies spread across most market and economic conditions. The results are downright impressive resulting in an easy to use, numerical rating system that can pinpoint those stocks that truly have the best odds of top performance over the longer term.

Stocks that have earned a 10 Long Term PowerRating have been proven to have a 81% chance of being higher one year later, those with a 9 rating possess a 79.1% chance of being higher one year later. Conversely, those with the lowest 1 or 2 ratings have shown to simply be too volatile, thus risky for prudent long term investment. Due to the extreme volatility of the low rated stocks, of course, several will outperform, sometimes returning many fold percentages. However, 65% have been proven to lose money over a year time period. In fact, they lost an average of 5% over a one year timeframe. Our studies clearly indicate that conservative, long term investors should avoid stocks with low PowerRatings and build a portfolio with high rated stocks. Le's take a closer look at several of the upgrades today:

Allete (ALE | Quote | Chart | News | PowerRating) - This Minnesota based diversified utility company has just been upgraded from a 4 to a 5 Long Term PowerRating. They just released excellent numbers across a variety of the primary metrics for the third quarter. The CEO, Don Shippar, has provided very positive guidance for the rest of the year and even their real estate business performed well despite the poor environment. Technically, the stock appears to have bottomed around the $32.00/share area. The 50 and 200 day Simple Moving Averages are both in the $40.00/share range which may lead some market technicians to believe that a bounce to this level will occur shortly.

Psychiatric Solutions (PSYS | Quote | Chart | News | PowerRating) - An interesting company that specializes in outpatient behavioral services. It seems to a good economy for the counseling business! It makes sense that economic stress would booster this type of operation. Income increased over 37% for the third quarter and revenue was up 13%. Technically, the stock has been climbing sharply since October,27th . Price is right below both the 50 and 200 day Simple Moving Average that are in the $34-35.00/share area. The company has just been upgraded from a 4 to a 5 Long Term PowerRating and it deserves careful consideration for your portfolio.

Xerox (XRX | Quote | Chart | News | PowerRating) - Here is a classic name in the printing and document management space. The company was just awarded an upgrade from 4 to a 5 Long Term PowerRating. Their business model is built on a recurring revenue stream and not simply the sale of equipment. Revenues were up 2% and the third quarter is reported as stable despite the shrinking economy. Technically, shares bottomed around the 27th of October and have been bouncing slightly since this time. Price is still well below technically critical 50 and 200 day Simple Moving Averages at 10 and 13 dollars per share. This is a good company with solid business that should be closely watched here.

Learn what you need to know as an active investor looking to invest in companies with a history of financial strength and a track record for growth. Click the link above or call us at 888-484-8220 extension 1 to get your copy of the "5 Secrets to Successful Stock Investing" today!

David Goodboy is Vice President of Marketing for a New York City based multi-strategy fund.