PowerRatings Weekly Outlook; MKC,KMB,PG,ALK,BRK-A

The week started on a bullish note with a huge upmove on Tuesday that continued into Wednesday, as the DJIA surged up toward the 50-day Simple Moving Average. Commodities in a free fall, namely oil, and the Feds neutral stance on interest rates combined to fuel the aggressive rally.

Unfortunately, this shot in the arm was short lived as economic reality hit the market hard on Thursday. The Markets dropped hard, giving back much of the gains, on rising jobless claims, disappointing earnings, stabilizing oil prices, and further mortgage default fears. Friday, the markets are once again surging higher on positive news from the retailers and airlines. Despite the wild swings this week, our PowerRatings still managed to find outperforming stocks in several sectors.

The Ratings are a ranking from 1 to 10 that are based on statistically valid 12 year study across most market conditions. The lower the rating, the less suitable the stock is for long term investment. Stocks that are rated 1-3 are simply too volatile, thus risky to make wise investments. The midrange ratings 4,5,6,7, have been shown to match the overall market performance. The top rated stocks 8, 9, 10 are proven to have increased odds of being higher one year later. In fact, our extensive studies clearly show that stocks with a 9 rating have a 79.1% chance of being higher one year later, and a 10 rating has a 81% chance of the higher close. These are strong statistical odds that will provide you an edge in stock picking.

Here are a few of the highlights this week from our Long Term Power Ratings Screener:

Mccormick & Company (MKC | Quote | Chart | News | PowerRating): This spice, flavoring and specialty food company moved from an 8 into the 9 rating on Monday. It is outperforming the Packaged Food Industry sector which has a Long Term Power Sector Rating of 8. MKC just completed an acquisition of its competitor Lawry's from Unilever. In addition, on July 31, they reported strong growth and profits reflected in an 11% increase in sales and an 11% increase in Earnings Per Share. Technically, the stock has been in an uptrend since July 1 and is well above both the 50 and 200-day Simple Moving Average.

Kimberly Clark(KMB | Quote | Chart | News | PowerRating): This 10 rated stock was mentioned on Tuesday. It is a member of the personal products sector which has a rating of 7. The stock is clearly outrating its sector. It's been in a nice uptrend since its mid-July lows. Fundamentally the company looks very healthy having just announced an 11% increase in sales and a quarterly dividend.

Proctor and Gamble (PG | Quote | Chart | News | PowerRating): This is the top rated stock in the DJIA. It ranks a 9 in a sector that earns a 7 rating. They just announced a 13% operating profit growth and a 5% sales growth increase. It has been in a steady uptrend since its July 1st lows and is the leader in its business lines. It is clearly outrating its sector and has a strong fundamental underlying structure.

Alaska Air Group (ALK | Quote | Chart | News | PowerRating): This bottom of the barrel, lowest of low 1 rated stock is vastly underperforming its regional airline sector that earned a 4 rating. The airline reported a difficult second quarter with a net loss of $14.1 million and declining capacity. The company blames fuel costs as the culprit in the malaise. To further the troubles, it was just announced that an employee was misdirecting card payments to the employee's personal account. Talk about how to easily lose the trust of your customers. This is one company/stock that should be avoided by long term investors.

Berkshire Hathaway (BRK-A | Quote | Chart | News | PowerRating): This is famed investor's Warren Buffet's baby. It has earned a Long-Term PowerRating of 9 in a 9 rated sector. This is an ultra high price stock, currently trading at $116100.00/share. If you have the financial wherewithal and are a fan of Mr. Buffet, the Long-Term PowerRatings confirm that this may be a wise investment.

Stocks In The News

Wal-Mart (WMT | Quote | Chart | News | PowerRating): Posted weaker than expected 2nd quarter earnings

Citibank (C | Quote | Chart | News | PowerRating): Lost a huge SEC false marketing suit and is being forced to return 7 billion dollars to investors plus pay 100 million in fines

Fannie Mae(FNM | Quote | Chart | News | PowerRating): The mortgage company lost 2.3 billion in the 2nd quarter which is 3 times most analysts estimates.

Intel(INTC | Quote | Chart | News | PowerRating): Positive guidance by a Citibank analyst stating that increased demand for its atom processor and cheap computers make the companies forecasts achievable.

This Weeks Top Performers

Pitney Bowes(PBI | Quote | Chart | News | PowerRating)

Bio-Rad Labs (BIO | Quote | Chart | News | PowerRating)

Health South (HLS | Quote | Chart | News | PowerRating)

Enpro Industries (NPO | Quote | Chart | News | PowerRating)

This Weeks Worst Performers

Otter Tail Corp (OTTR | Quote | Chart | News | PowerRating)

Amn Health Care (AHS | Quote | Chart | News | PowerRating)

Bronco Drilling (BRNC | Quote | Chart | News | PowerRating)

Buckeye Partners (BPL | Quote | Chart | News | PowerRating)

What To Watch Next Week

Tuesday—Trade Balance and Treasury Budget

Wednesday—Retail Sales and Business Inventories

Thursday—Initial Claims and CPI

Friday-Industrial Production and Capacity Utilization

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