MainStay Large Cap Growth Fund ( MLAAX ) has built a solid 10-year performance record investing in a variety of growth stocks. The fund's sector weights show where the fund managers see the best opportunities for stock price appreciation.
The $15.5 billion fund had 23% of its shareholders' money at work in consumer cyclical stocks as of Feb. 29, by Morningstar Inc.'s count. That was double the S&P 500's 11% weighting.
Consumer cyclical sector funds rank eighth out of 14 sectors in performance over the past year.
The fund was also overweight in health care, 23% vs. 15%. And it was overweight in technology, 24% vs. 19%.
Health care funds rank 11th in one-year performance. Tech funds rank seventh.
Some of the fund's consumer cyclical stocks could be poised to run higher. Amazon ( AMZN ) is down 13% from its 52-week high but up 25% from its February low. Trading around 601, it was working on acup-with-handle base with a 603.34 buy point. The 600 level has been an area of resistance in recent days. Amazon is also shaping the right side of a lopsided double-bottom base. If the stock doesn't find strong volume in crossing the handle buy point, the next likely buy point would be the middle peak of the double-bottom, or 638.16.
Aggressive traders might have bought when Amazon broke out of a downtrend on March 24. New buyers should wait for a breakout past the handle.
Home Depot ( HD ), another consumer cyclical, is just above break-even so far this year. Trading around 134, it has rallied 22% off its Feb. 8 low. And it is within 2% of its 132.22 buy point.
It has IBD's Composite Rating of 96. The Composite Rating combines IBD's five stock-performance ratings, including EPS and Relative Strength ratings, with 99 being the highest.
The home improvement retailer's sales have been lifted by the housing rebound. Also, its dividend yield is 2.1%.
Among health care stocks, UnitedHealth Group ( UNH ) is a bet that is already paying off. The provider of managed health care services is up 7% so far this year. And shares are up 18% from their Jan. 14 low.
Earnings per share growth is slowing. In the past four quarters, respectively, EPS grew 30%, 15% and 3%, and then shrank 15%. Some of its slowdown is due to losses selling coverage on Affordable Care Act health exchanges .
Analysts see earnings rising 11% in the current quarter and 20% for the full year.
Tech giant Facebook ( FB ) is up 4% this year. Shares are forming a lopsided cup with handle. Trading around 111, its pivot point is 116.99.
EPS grew 16%, 33% and 46% in the past three quarters, respectively. The stock has an IBD Composite Rating of 99.
Alphabet (GOOGL) is down about 3% this year. EPS grew 1%, 5%, 17%, 18% and 28% the past five stanzas. The stock has a 98 Comp Rating.
Trading around 761, shares are in a cup-with-handle pattern, showing a 777.41 entry.
The fund had big underweights in financial services, 7.5% vs. 14%. It is also underweight in energy, 0% vs. 6.8%, and in consumer defensive, 3.4% vs. 10.4%.
The fund is subadvised by a team from Winslow Capital Management. Clark Winslow and Justin Kelly have been on the fund since late 2005. Patrick Burton joined in early 2013.
The fund's 7.47% average annual gain over the 10 years going into Tuesday beat 71% of its peer group. Year to date, in a turbulent 2016, the fund has lost 6.30% vs. a 3.16% setback for its direct rivals and a 0.54% gain for the S&P 500.
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