The Globe and Mail attempts to identify low beta stocks that have exceeded analyst expectations in its Thursday, Sept. 24, edition. The Globe's Ian Tam writes in the Number Cruncher column that he focused on stocks that
have shown less sensitivity to overall
market movements. Mr. Tam explains that a stock's beta is its
sensitivity to an underlying index
(in this case, the S&P/TSX composite).
High beta stocks tend to
rise or fall more than the index
in trending markets, while lower
beta stocks tend to rise or fall less
than the index in trending markets.
Mr. Tam considered the five-year historical beta. He looked for recent positive earnings surprises
(the difference between the consensus
estimate just prior to a
company's quarterly report, and
the actual reported figure).
Qualifying companies had to have a
market cap of at least $900-million.
Mr. Tam's qualifying stocks are DHX Media, Enghouse Systems, Novadaq Technologies, Open Text, Rona and CCL Industries.
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