Institutional Investors Say Stocks Offer Most Upside Now

Thanks to a new poll from Barclays PLC we know where investors are placing their bets: Stocks of companies with global business exposure.

The results are part of a survey sent to several hundred institutional clients of the bank. Forty-nine percent say stocks offer the most upside over the next three to six months, three times the number of participants citing commodities and emerging markets.

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Investors were then asked to specify which sector within global equities offers the most upside. Forty-two percent cited multinational companies, compared to only 17 percent who favored U.S. domestic-only companies. Defensive sectors, financials and commodity-related businesses fared slightly worse.

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To identify individual stocks in the global equity sweet spot, we screened the S&P 500 Index for companies with non-U.S. sales that account for at least 50 percent of total sales, and whose earnings are forecast to grow at least 25 percent this year based on consensus estimates tracked by Bloomberg.

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Only 10 companies met our criteria. Their stocks are up an average of 15.6 percent this year, nearly three times the return of the S&P 500 Index (5.9 percent). They include: Applied Materials, Inc. (AMAT); Avago Technologies Ltd. (AVGO), Harmon International Industries, Inc. (HAR); Lam Research Corp. (LRCX); Microchip Technology Inc. (MCHP); The Priceline Group Inc. (PCLN); Texas Instruments Inc. (TXN); Wynn Resorts Limited (WYNN); Xilinx, Inc. (XLNX) and YUM! Brands, Inc. (YUM).

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Four companies narrowly missed our criteria. Their stock performance is also well ahead of the S&P 500 Index this year, and we share them exclusively with blog readers: Alcoa Inc. (AA); Alexion Pharmaceuticals, Inc. (ALXN); Corning Inc. (GLW).

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