Rallying Manufacturing Stocks: March Manufacturing Data Beats Expectations

Data from the Institute for Supply Management shows the pace of growth in the U.S. manufacturing sector picked up in March, from 52.4 to 53.4, pushing U.S. stocks higher. Economists had anticipated a reading of 53.0.

The resulting rally was led by energy and basic material stocks, which brought the S&P 500 to its highest levels since May of 2008, and the Dow to December 2007 highs.

Europe also benefited: Reuters reports, "The upbeat U.S. data and an 11-month high in the official Chinese purchasing manufacturing index lifted European shares to their biggest daily gain in three weeks."

Business section: Investing ideas
So, which companies are benefiting from this trend? The answer greatly lies within the energy (utilities) and basic resources industry.

But which names might have more upside to price in? For ideas, we began by screening for stocks in the aforementioned industries with market caps above $10 billion, and then for those that are currently rallying above their 20-day, 50-day, and 200-day moving averages.

We also looked for stocks that have seen greater increases in EPS estimate over the last 30 days than changes in price over the same time period. This may indicate that the stock is discounted from its fair value.

These large-cap names have upward bullish momentum -- do you think any of these names have more to price in? (Click here to access free, interactive tools to analyze these ideas.)

1. Compania de Minas Buenaventura: Engages in the exploration, mining, processing, and development of gold, silver, and other metals in Peru. Industry: Gold. Market cap at $11.11B. The stock is currently trading at 3.93% above its 20-day MA, 1.26% above its 50-day MA, and 1.02% above its 200-day MA. The EPS estimate for the company's current year increased from 3.73 to 3.8 over the last 30 days, an increase of 1.88%. This increase came during a time when the stock price changed by -6.85% (from 42.07 to 39.19 over the last 30 days).

2. Devon Energy (NYSE: DVN  ) : Engages in the acquisition, exploration, development, and production of natural gas and oil in the United States and Canada. Industry: Independent Oil & Gas. Market cap at $28.74B. The stock is currently trading at 0.75% above its 20-day MA, 3.86% above its 50-day MA, and 7.6% above its 200-day MA. The EPS estimate for the company's current year increased from 6.27 to 6.4 over the last 30 days, an increase of 2.07%. This increase came during a time when the stock price changed by -4.19% (from 75.19 to 72.04 over the last 30 days).

3. Ecopetrol: Operates as an integrated oil company in Colombia, Peru, Brazil, and the U. Industry: Major Integrated Oil & Gas. Market cap at $123.62B. The stock is currently trading at 4.06% above its 20-day MA, 10.94% above its 50-day MA, and 36.16% above its 200-day MA. The EPS estimate for the company's current year increased from 4.23 to 4.6 over the last 30 days, an increase of 8.75%. This increase came during a time when the stock price changed by 7.81% (from 56.32 to 60.72 over the last 30 days).

4. EOG Resources (NYSE: EOG  ) : Engages in the exploration, development, production, and marketing of natural gas and crude oil primarily in the United States, Canada, the Republic of Trinidad, Tobago, the United Kingdom, and the People's Republic of China. Industry: Independent Oil & Gas. Market cap at $29.93B. The stock is currently trading at 0.03% above its 20-day MA, 1.21% above its 50-day MA, and 14.84% above its 200-day MA. The EPS estimate for the company's current year increased from 4.89 to 5.07 over the last 30 days, an increase of 3.68%. This increase came during a time when the stock price changed by -4.95% (from 117.55 to 111.73 over the last 30 days).

5. Monsanto (NYSE: MON  ) : Provides agricultural products for farmers in the United States and internationally. Industry: Agricultural Chemicals. Market cap at $42.70B. The stock is currently trading at 2.91% above its 20-day MA, 2.38% above its 50-day MA, and 11.94% above its 200-day MA. The EPS estimate for the company's current year increased from 3.5 to 3.51 over the last 30 days, an increase of 0.29%. This increase came during a time when the stock price changed by -1.36% (from 79.52 to 78.44 over the last 30 days).

6. Noble Energy: Engages in the acquisition, exploration, development, production, and marketing of crude oil, natural gas, and natural gas liquids in the United States, West Africa, Eastern Mediterranean, the North Sea, and internationally. Industry: Independent Oil & Gas. Market cap at $17.48B. The stock is currently trading at 2.89% above its 20-day MA, 0.27% above its 50-day MA, and 10.11% above its 200-day MA. The EPS estimate for the company's current year increased from 6.1 to 6.17 over the last 30 days, an increase of 1.15%. This increase came during a time when the stock price changed by -7.85% (from 104.57 to 96.36 over the last 30 days).

7. Edison International: Engages in the supply of electric energy in central, coastal, and southern California. Industry: Electric Utilities. Market cap at $13.85B. The stock is currently trading at 0.28% above its 20-day MA, 2.63% above its 50-day MA, and 10.29% above its 200-day MA. The EPS estimate for the company's current year increased from 2.44 to 2.49 over the last 30 days, an increase of 2.05%. This increase came during a time when the stock price changed by 1.04% (from 42.23 to 42.67 over the last 30 days).

8. FirstEnergy (NYSE: FE  ) : Operates as a diversified energy company. Industry: Electric Utilities. Market cap at $19.07B. The stock is currently trading at 2.34% above its 20-day MA, 4.92% above its 50-day MA, and 6.39% above its 200-day MA. The EPS estimate for the company's current year increased from 3.29 to 3.41 over the last 30 days, an increase of 3.65%. This increase came during a time when the stock price changed by 1.47% (from 44.07 to 44.72 over the last 30 days).

9. NextEra Energy: Engages in the generation, transmission, distribution, and sale of electric energy in the United States and Canada. Industry: Electric Utilities. Market cap at $25.42B. The stock is currently trading at 2.41% above its 20-day MA, 3.23% above its 50-day MA, and 10.06% above its 200-day MA. The EPS estimate for the company's current year increased from 4.51 to 4.52 over the last 30 days, an increase of 0.22%. This increase came during a time when the stock price changed by -0.61% (from 60.77 to 60.4 over the last 30 days).

10. National Grid (NYSE: NGG  ) : Operates regulated electricity and gas infrastructure networks in the United Kingdom and northeastern United States. Industry: Gas Utilities. Market cap at $36.0B. The stock is currently trading at 1.32% above its 20-day MA, 2.16% above its 50-day MA, and 5.6% above its 200-day MA. The EPS estimate for the company's current year increased from 3.97 to 4.01 over the last 30 days, an increase of 1.01%. This increase came during a time when the stock price changed by -1.21% (from 51.31 to 50.69 over the last 30 days).

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.


Kapitall's Eben Esterhuizen does not own any of the shares mentioned above. EPS data sourced from Yahoo! Finance, all other data sourced from Finviz.

The Motley Fool owns shares of Devon Energy. Motley Fool newsletter services have recommended buying shares of Devon Energy and National Grid. Motley Fool newsletter services have recommended creating a synthetic long position in Monsanto. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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