BIDU

Fave Five (1/13/2017)

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Fave Five (1/13/2017)

Our Fave Five essentially represents a listing of stocks with favorable short term total return forecasts (1 year, according to Analyst Consensus Estimates, or ACE) combined with strong long-term return forecasts and good/excellent quality rankings. The average 1-year ACE total return forecast is 8.0%.

This week we take a slight departure to pay homage to remarks made by Jeff Gundlach during the DoubleLine “Just Markets” webcast on Tuesday. Specifically, the macro observations included a nudge to consider equities in places like India and Japan, suggesting that U.S./Canada valuations might be getting a little steep.

Turning attention to the universe of stocks outside the U.S. & Canada, we find another “Lost Decade.” The stocks in the Morgan Stanley iShares MSCI EAFE exchange traded fund (EFA) have delivered a -0.6% return ANNUALIZED since 2007 while the Wilshire 5000 checks in at 7.3%. So we went searching for the highest ranked stocks that call an address “home” outside either Canada or the United States.

We granted Stella-Jones (SJ-TO) an exception in honor of Jeremy Grantham’s honorary timber class.

For more information on joining our 11th annual Groundhog Challenge, launching 2/2/2017, as either a group or an individual investor, drop a note to markr@manifestinvesting.com.

The Fave Five This Week

  • Baidu (BIDU)
  • Infosys Tech (INFY)
  • MercadoLibre (MELI)
  • Stella-Jones (SJ-TO)
  • Teva Pharma (TEVA)

The Long and Short of This Week’s Fave Five

The Long & Short. (January 13, 2017) Projected Annual Return (PAR): Long term return forecast based on fundamental analysis and five year time horizon. Quality Ranking: Percentile ranking of composite that includes financial strength, earnings stability and relative growth & profitability. VL Low Total Return (VLLTR): Low total return forecast based on 3-5 year price targets via Value Line Investment Survey. Morningstar P/FV: Ratio of current price to fundamentally-based fair value via www.morningstar.com S&P P/FV: Current price-to-fair value ratio via Standard & Poor’s. 1-Year ACE Outlook: Total return forecast based on analyst consensus estimates for 1-year target price combined with current yield. The data is ranked (descending order) based on this criterion. 1-Year S&P Outlook: 1-year total return forecast based on S&P 1-year price target. 1-Yr GS: 1-year total return forecast based on most recent price target issued by Goldman Sachs.

Fave Five Legacy (Tracking Portfolio)

The relative/excess return for the Fave Five tracking portfolio is +3.6% since inception. 45.1% of selections have outperformed the Wilshire 5000 since original selection.

Tracking Dashboard: https://www.manifestinvesting.com/dashboards/public/fave-five

Fave Five: Escape Velocity

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Fave Five (12/9/2016)

Our Fave Five essentially represents a listing of stocks with favorable short term total return forecasts (1 year, according to Analyst Consensus Estimates, or ACE) combined with strong long-term return forecasts and good/excellent quality rankings. The average 1-year ACE total return forecast is 8.1%.

Every year we run a stock selection challenge starting on Groundhog Day (February 2) and running for the next twelve months. Individual investors and groups like investment clubs are welcome to participate by choosing 5-20 stocks.

We’ve now got nine annual contests under our belt. We crown an individual and group champion every year.

Escape Velocity

In three of the last four years, the Broad Assets Investment Club of St. Louis has toppled dozens of competing groups — taking home multiple Groundhog stock selection championships.

I’ll let that sink in.

Three of the past four years. Their excess/relative return (annualized) since inception is +28.7%.

Let that sink in, too.

We want some of whatever they’re having. Seriously, we checked the water … asked what they had for breakfast, etc. in an effort to come to grips with the primary driver behind their stunning success and track record. We discovered one potential influence. It seems like Broad Assets latches on to companies that have huge incremental improvements in earnings forecasts for next year versus this year. We detailed our findings in our cover story, Victory By Escape Velocity?

This week’s Fave Five is based on companies with solid long-term outlooks that also have superior earnings forecasts for 2017 versus estimates for 2016. The bracketed column displays the top five year-over-year forecasts, according to analyst consensus estimates. [Source: ACE and finance.yahoo.com]

The median year-over-year (2017/2016) differential for the ~2400 companies we cover is currently 11.8%.

For more information on joining our 11th annual Groundhog Challenge, launching 2/2/2017, as either a group or an individual investor, drop a note to markr@manifestinvesting.com.

The Fave Five This Week

  • Allergan (AGN)
  • Baidu (BIDU)
  • Celgene (CELG)
  • Five Below (FIVE)
  • Universal Display (OLED)

The Long and Short of This Week’s Fave Five

The Long & Short. (December 9, 2016) Projected Annual Return (PAR): Long term return forecast based on fundamental analysis and five year time horizon. Quality Ranking: Percentile ranking of composite that includes financial strength, earnings stability and relative growth & profitability. VL Low Total Return (VLLTR): Low total return forecast based on 3-5 year price targets via Value Line Investment Survey. Morningstar P/FV: Ratio of current price to fundamentally-based fair value via www.morningstar.com S&P P/FV: Current price-to-fair value ratio via Standard & Poor’s. 1-Year ACE Outlook: Total return forecast based on analyst consensus estimates for 1-year target price combined with current yield. The data is ranked (descending order) based on this criterion. 1-Year S&P Outlook: 1-year total return forecast based on S&P 1-year price target. 1-Yr GS: 1-year total return forecast based on most recent price target issued by Goldman Sachs.

Weekend Warriors

The relative/excess return for the Weekend Warrior tracking portfolio is +5.8% since inception. 51.9% of selections have outperformed the Wilshire 5000 since original selection.

Tracking Dashboard: https://www.manifestinvesting.com/dashboards/public/weekend-warriors

Weekend Warrior Tracking Portfolio: Selling Discipline

There are two primary selling conditions for the Weekend Warrior tracking portfolio.

  • For the first year after selection, if the excess/relative return (vs. the Wilshire 5000) becomes less than -20%, the position is closed.
  • A position is also closed (usually with a victory lap) when the return forecast (PAR) is less than the median return forecast (MIPAR).

This week, Stifel Financial (SF) and Raymond James (RJF) have both been on a surge, gaining 65% since selection. With return forecasts of 2-4% when the median return forecast is now 5% — both positions were closed. [High Five]

This Weekend’s Dirty Dozen (10/9/2015)

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Some potential studies for this weekend …

Dirty Dozen

I’ve been looking back over some previous “Dirty Dozens” and the anecdotal results we’ve seen over the last several months and it appears to be compelling — at least anecdotally. The recent price bump in Copa Holdings (CPA) is a case in point among many as I was updating the various “cases.”

It probably makes sense to shop among the stocks with the most perception of upside (think rhino sentiment) while continuing to shop among the higher-quality companies.

In that spirit, here is a current Dirty Dozen that is formed by ranking the highest total return expectation based on analyst consensus expectations (ACE, Source:finance.yahoo.com).

Music, Generosity & One World. One Dream.

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Watching last night’s Grammy Awards, I was once again reminded of many things. From Faith Hill’s “Don’t Hurry … But Don’t Wait” to the magic of Michael Jackson and his pile of awards. But for some reason, I was reminded distinctly of Mother Theresa. Did you know that Mother Theresa won the inaugural Templeton Award?  In this feature from August 2008, we honored the legacy of lifetime achievement in investing by one Sir John Templeton.

One World, One Dream

Sir John Templeton (1912-2008) started his Wall Street career in 1937 and went on to create some of the world’s largest and most successful international investment funds. He was called by Money magazine “arguably the greatest global stock picker of the century.”

Sir John Templeton gave us a legacy of long-term investing wisdom. Sadly, he passed away during July (2008) at the age of 95. A Rhodes Scholar, his adventures spanned the globe — seeking opportunity independent of domicile. His religion and philanthropy were very important to him. Did you know that Mother Theresa received the inaugural Templeton award, valued at $2 million? The monetary award is what it is because Sir John always wanted his faith-based awards to be worth more than the Nobel Prize. Inspired by MANIFEST subscriber Frank Bower, let’s take a look at some of Templeton’s guiding principles.

Over the years, Sir John Templeton published a number of articles and made speeches about his investing principles. This list was culled by John Christy from memories of working with Templeton for Forbes. Let’s visit these themes in our own words and methods.

For more: One World. One Dream.