The top 50 stocks in terms of price/earnings multiples underperformed the Standard & Poor's 500 Stock Index by three percentage points in June, the second month in a row the group has underperformed.
The top 50 p/e stocks were down 5.86% for the month; the S&P declined 2.68%, according to a report by Kidder, Peabody & Co.'s Quantitative Research Group.
Over the most recent three months, the top 50 stocks were down 5.21%, compared with a decline of 0.34% for the S&P 500.
However, the report notes, over the past two years, the top 50 group was up 29%, compared with a gain of just 8.85% for the S&P 500.
The median p/e for the top 50 group declined to 27.2 in June from 28.8 in May.
The stock with the highest p/e at the end of June was Ann Taylor Stores Corp., at 44.1. Following were Nucor Corp., 43.6; Office Depot Inc., 40.3; La Quinta Inns Inc., 40.2; and Home Depot Inc. at 39.
Stocks with the lowest p/e were Motorola Inc., 23.1; Fluor Corp., 23.1; Automatic Data Processing Inc., 23.2; SPS Transaction Services Inc., 23.3; and Genesis Health Ventures, 23.3.
New additions to the top 50 in June were Coca-Cola Co. with 23.5 and Wal Mart Stores Inc. with 23.3.
