S&P Top Ten Calls on Intrado

The provider of 911 services to telecoms replaces Boston Scientific in S&P's portfolio of best investment ideas

On Sept. 10, Standard & Poor's equity research group made changes to the S&P Top 10 portfolio -- those issues it considers to be the best candidates for capital gains over the next 6 to 12 months. S&P replaced medical-device maker Boston Scientific (BSX ) with Intrado (TRDO ), a leading provider of U.S. "911" emergency response infrastructure for both wireline and wireless telecom networks (See BW Online, 9/8/03, "Where Emergency Calls Are Welcome").

Boston Scientific left the portfolio after S&P analyst Robert Gold downgraded the stock's investment ranking to 4 STARS (accumulate) from 5 STARS (strong buy) on Sept. 9. (All the stocks in the portfolio are ranked 5 STARS.) Gold cited regulatory risks to the company's stent products and increased concerns over a possible price battle with rival Johnson & Johnson (JNJ ),which led him to reduce his 12-month target price for the stock to $68 from $75.

Meanwhile, S&P analyst Todd Rosenbluth believes that Intrado will be a primary beneficiary of several regulatory trends, which should help boost profit growth. He also sees greater demand for Intrado's mass-disaster notification services. Based on a blend of ~

~discounted cash-flow

Year-to-date through Aug. 29, the S&P Top Ten portfolio gained 24.42% vs. an advance of 15.95% for its benchmark, the S&P 500-stock index (both of these performances include dividends).

Here's the latest list:

S&P Top 10 Portfolio

Company Price (9/10/03 close) 12-Month Target Investment Rationale
Comcast (CMCSA ) 30.36 37 Increasing synergies from broadband acquisition
Compass Bancshares (CBSS ) 34.76 41 Valuation, positive fundamental trends
Corinthian Colleges(COCO ) 54.21 65 See extended growth period; undervalued
DR Horton (DHI ) 29.49 38 Better-than-expected industry trends
Fair Isaac (FIC ) 59.62 68 Attractive valuation
Flextronics (FLEX ) 13.65 15 Firming business, low valuation
Intel (INTC ) 27.66 38 Recovery in worldwide chip demand expected to drive growth
Intrado (TRDO ) 21.01 30 Regulatory trends should help boost profits
Jacobs Engineering (JEC ) 47.09 55 See strong bookings from refining customers
Martek Biosciences(MATK ) 52.57 59 Annual revenue growth of nearly 100% seen through fiscal 2004

For more information about the Top 10 portfolio, please visit http://www.businessweek.com/investor/content/jun2002/pi20020617_8998.htm

By Ken Shea and Robert Gold

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