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Monday, February 05, 2007

Albany International Corp. (AIN)

Paper & Forest Products is an industry that doesn’t get a lot of press. That’s probably because it’s about as boring as last night’s Super Bowl commercials, which I vote as the worst of all time (minus Jim Gaffigan’s “beard-over”). He’s hilarious and if you’ve never seen his hot pocket skit…it classic:

In any case, I’ve noticed alpha generation over the last few weeks within the paper & forest products industry via the Fidelity Select Paper & Forest Products (FSPFX) fund, a current holding in our Model Fidelity Portfolio.

Obviously the industry has performed in line with the market over the last six months or so. But what I want to point out is the alpha generation over the last two months and particularly the last week. Part of the alpha can be attributed to capital inflows from the bears looking to allocate into non-cyclical sectors in light of volatility foreseen in tech. But maybe there’s something more that warrants further analysis?

After running our analytic this weekend, I looked for any companies within the Paper & Forest Products industry that were recently upgraded to “buy” status. Low and behold, we have Albany International Corp. (AIN) which according to Google Finance, “operates in three business segments: Paper Machine Clothing, Applied Technologies and Albany Door Systems.”

Albany International Corp. has all the qualities I look for when selecting stocks for the blog. It’s in a highly-ranked sector, Basic Materials (IYM), which although not currently “buy” rated is still generating alpha. It has an AAS Rating Score above 5, which indicates sufficient trend development and momentum, and it recently crossed over its 200-day moving average.

Short-Term Technical Indicators

Investor Sentiment

Long-Term Market Model – Bearish since December 8th.

Asset Allocation – AAS Model Portfolios are between 56.25% and 75% long currently.

Beta Exposure and Portable Alpha Generation
Date = Date of AAS “Buy” or “Short/Sell” Recommendation

Top Rated Major Market Derivative – No buy recommended major market investments

Top Rated Style-Box Derivative – No buy recommended style-box investments

Top Rated Sector Derivative – iShares Dow Jones U.S. Telecom (IYZ 1/26/07)

Today’s Top “Buy” Recommended Stocks

NBTY, Inc. (NTY 12/5/06)

CPI Corp. (CPY 1/23/07)

Navistar International Corp. (NAV 9/12/06)

Intuitive Surgical, Inc. (ISRG 2/2/07)

SWS Group Inc. (SWS 11/7/06)

Martin Marietta Materials, Inc. (MLM 11/6/06)

Precision Castparts Corp. (PCP 9/20/06)

Energizer Holdings Inc. (ENR 1/26/07)

MEMC Electronic Materials, Inc (WFR 1/8/07)

The Ryland Group Inc. (RYL 1/18/07)

Today’s Top “Sell” Recommended Stocks

Plexus Corp. (PLXS 12/29/06)

Advanced Micro Devices Inc. (AMD 9/27/06)

Brightpoint Inc. (CELL 9/19/06)

Rogers Corp. (ROG 12/6/06)

StarTek, Inc. (SRT 11/28/06)

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