This Week at MANIFEST (12/12/2014)

Just One Thing

We took a few moments during the red carpet session during the February 2011 Round Table to celebrate Jack Palance and Billy Crystal. Specifically, we focused on the scene from City Slickers where Jack shares secrets of life with Billy Crystal — focusing on that ONE THING. In that spirit we encouraged the knights and damsels for their one thing in the realm of long-term investing.

1. Anne Manning shared that it’s SHARING. “The longer I do this, the more I learn. And this group of long-term investors is so helpful, so warm that it makes a challenge less challenging.”

2. Mark Robertson shared that it’s simply the power of TIME. “TIME is not a 4-letter word. TIMING is a 4-letter word.” “The longer I do this, the more I’m able to put speed bumps and bubbles into context and remain focused on the long-term perspective.”

3. Cy Lynch would single out PATIENT DISCIPLINE. He shared his story of being patient with a promising home improvement in the Atlanta area back when the enterprise had 4-8 locations. The company bought a group of stores in the New Orleans area to expand geographically and the stock price tanked. The rest of the story is that Cy still owns many shares of Home Depot — AFTER distributing many shares along the way to his favorite philanthropic causes. (Cy is apparently the Susan Lucci of these award programs. He doesn’t have the highest or lowest performing selections … he’s a rock near the middle of the pack — although he’d admit that he’s ready for Bio-Reference Labs to take off.)

4. Ken Kavula centered on the small company philosophy, reinforcing that there’s powerful motivation behind the recipe to include a blend of small, faster-growing companies in the mix with blue chip, slower-growing stalwarts. It’s also possible — and very, very highly recommended — to be stubborn about quality when dealing with the promising companies. During the program, Ken shared that his purchase of PRAA dates back to 2003-2004 and was probably inspired by the Forbes Best Small Company list at that time.

5. Hugh McManus: “Patience is genius in disguise.”

Coming Events and Attractions

We’ll continue our expanded coverage of the update stocks this month as part of our quarter long test drive of this feature and the studies and shared ideas it delivers. Please tell us what you think and feel free to join in the Forum discussions for the deeper dives on some of the stocks.

Save the Date: The December Round Table will be held on December 30 at 8:30 PM ET. Register via: https://www2.gotomeeting.com/register/256833802

Companies of Interest: Value Line

The average Value Line low total return forecast for the companies in this week’s update batch is 3.0%.

Materially Stronger: None.

Materially Weaker: Cliffs Natural Resources (CLF), Seattle Genetics (SGEN), Allscripts Healthcare (MDRX), Huntington Ingalls (HII)

Coverage Initiated:

Discontinued:

Name Change: Wellpoint (WLP) is now Anthem (ANTM)

Companies of Interest: Morningstar

The average price-to-fair value (P/FV) ratio at Morningstar for the companies in this week’s update batch is 107%.

It’s clearly not Black Friday … and we left a few of the significantly overpriced (by virtue of nosebleed P/FV ratios) on the list.

Companies of Interest: S&P

The average price-to-fair value for the companies in this week’s update batch is 96% — according to S&P. That’s a significantly different opinion than Morningstar, in general … and again.

Market Barometers

The median Value Line Low Total Return (VLLTR) Forecast is at 3.7% — unchanged from 3.7% last week.

Stocks to Study

The following update stocks are ranked in the top 10th percentile of all companies we follow (MANIFEST Rank > 90) and this display provides a wide berth of dueling opinions, as usual.

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