AI‑Powered ProPicks Rotation – September Update
The proprietary AI‑driven ProPicks model removed Haemonetics Corporation (NYSE:HAE) after securing an approximately 87 % gain over the past twelve months. The exit was prompted by a valuation that expanded to roughly 50 times trailing earnings, a modest revenue growth of about 0.4 %, declining margins, net leverage around 2.7 times EBITDA, and management’s decision to pause M&A activities to reduce debt.
Molina Healthcare (NYSE:MOH) was also sold, locking in a 46.4 % appreciation achieved in just five months. Despite beating Q2 earnings expectations, the stock fell 5‑9 % after the quarter, leaving it about 19 % below its 52‑week high. The company now trades at an adjusted forward price‑to‑earnings multiple near 157 x, with full‑year EPS guidance cut to $5.25 from more than $14 projected a year earlier. Operating margins have compressed to roughly 0.7 %, EBITDA is down about 78 % year‑over‑year, and Marketplace medical costs have risen to 90 %.
Capital redeployed from these exits was allocated to two new high‑conviction positions. APA Corporation (NASDAQ:APA) entered the portfolio after posting a 92 % total‑return over the prior year while trading at an attractive ~9 × earnings and a PEG ratio of 0.15, well below InvestingPro’s fair‑value estimate of $53 and Argus’s new buy target of $48. The company delivered Q2 results that exceeded expectations by roughly 59 %, generated $738 million of free cash flow, and raised its full‑year free‑cash‑flow outlook to about $2.3 billion while driving net debt toward $3 billion. Management also lifted Permian oil production guidance, kept capital expenditures flat at $1.3 billion, and accelerated a $500 million cost‑saving program.
The model also added TransDigm Group (NYSE:TDG), a high‑margin aerospace and defense parts manufacturer. After a 12 % decline earlier in the year, the stock now appears to offer roughly 30 % upside relative to analyst price targets near $1,520. TransDigm’s portfolio consists of about 90 % proprietary product sales and it maintains an acquisition capacity exceeding $10 billion. The company beat Q3 earnings forecasts by approximately 6 % and lifted its full‑year revenue guidance to around $10.5 billion and free‑cash‑flow guidance to roughly $2.6 billion, reflecting organic revenue growth of about 13 % across its three segments. Gross margins hover near 60 % and EBITDA margins stay above 52 %.
The article also notes that several other AI‑selected equities posted strong August performance, including Ramaco Resources (+55.29 %), Salesforce (+39.95 %), Peabody Energy (+39.72 %), Mativ Holdings (+37.3 %), and Gartner (+31.18 %). More than 25 stocks recorded double‑digit gains during the month.
Since the AI model’s launch in November 2023, the cumulative return of the technology‑focused picks has reached 187.39 %, delivering an outperformance of 105.94 % versus the S&P 500 benchmark. The service is offered to premium members for less than $9 per month and provides detailed rationales for each addition and removal.
The ProPicks system evaluates thousands of global equities each month using over 150 quantitative models applied to more than 15 years of financial data. Up to 20 high‑conviction stocks are selected per strategy, each weighted equally, and the portfolio is rebalanced monthly to replace securities that no longer satisfy the model’s criteria.
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