Round Table (May 2017)

These excerpts are from our monthly webcast series (The Round Table) that usually airs on the last Tuesday at 8:30 PM ET.  The sessions are FREE and include the selection of 3-5 stocks to study with a demonstration of the analysis used to determine the quality and return forecast.  This demonstration has beaten the market over the last seven years, featuring a collective rate of return of 13.2%.  A tracking portfolio is maintained at:
If you would like to be added to the reminder list for future sessions, send a request to be added to the list maintained at

The Core/Non-Core discussion was a thought starter for sure. Clarifying my thought, adding ‘Successfully’ to ‘Survived At Least One Recession’ means to me that the company was ‘at least’ earnings profitable during a recession period. An example would be UTHR owned by the investment club I belong to. — Marty Eckerle, Cincinnati

[Here is one of the slides used in the discussion …]

Core mettle


Selling Decisions Based on Relative Return

Nothing about the traditional selling decision, or Challenge, changes. We still sell with the overall portfolio characteristics in mind. It’s a standard procedure to challenge the holdings with the lowest return forecast. This was referred to by George Nicholson as “Rule One” for portfolio management. For this month’s meeting, Coach (COH) was challenged, updated, analyzed and sold to provide some boost to overall portfolio PAR.

Following that, any company selected within the trailing 12 months that lags (falls behind) the Wilshire 5000 and exhibits a relative return of -20% is subjected to some “head scratching.” The following flow/decision chart is an attempt to capture this process.

Rt flow chart 20170530

Selling Decisions (May 2017)

How To Use This Chart. This chart summarizes the decisions made by checking various attributes of stocks that have triggered the -20% relative return threshold over the last year.

The first chart is a dashboard sorted by PAR (Ascending). The stock at the top of the sort, Coach (COH) is therefore — on the HOT SEAT. After further discussion and the update included in this thread (see below), Coach did not survive and was SOLD.

When a stock reaches a relative return of -20% (versus the Wilshire 5000, VTSMX) it qualifies for this raking over the coals. The relative performance is displayed in the Relative Return column. If LKQ (LKQ) can remain under -20%, it will be removed from this listing at future Round Tables.

Core? is a decision as to whether a stock should be subjected to tighter constraints or given “blue chip” treatment with a “longer leash.” Most participants tend to regard Retail/Apparel companies as Non-Core and we’ve found over the years that steady forecasts and steady results are generally the hallmark of companies that we consider to be core.

If a company is deemed to be core, a quick check of the return forecast (PAR) and Quality is in order to detect degradation or erosion of expectations. In this case NVO is definitely “on the fence” and we’re monitoring for signs of further weakness. It was noted that the stock price performance has been stronger over the last few weeks.

The last “life line” (vs. Industry) is a quick check to see if a company is actually faring relatively well versus its industry or peers while lagging the market. This essentially “saved” LKQ last month as we noted that the Auto & Commercial Vehicle Parts Index (BigCharts: WSJUSIXOTA) has lagged the overall stock market.

Coach (COH) was sold from the Round Table tracking portfolio on 5/30/2017.

Coh analysis 20170530

The Audience Poll was a bit of a photo finish for May 2017. We ruled that the audience selected both Dollar General (DG) and LGI Homes (LGIH) and will invest $1000 in each. The live audience in Cincinnati on 5/19/2017 selected CVS Health (CVS).

Rt poll 20170530

Round Table (March 2017)

Round Table (March 2017)

The March Round Table included some reminders about the virtues of a 8-year bull market — and the significant potential of using the Triple Play screening criteria. Take a look back at our features from March-April 2009 and a number of case studies (and smiles for many of us) erupt.

Archive: (Will be added ASAP)

Stocks Presented

  • CVS Health (CVS)
  • EPAM Systems (EPAM)
  • Microchip Technology (MCHP)

The audience selected CVS Health (CVS).

Rt poll 20170328

These Are A Few Of Our Favorite Screens

January Round Table

Our Round Table, a monthly session featuring our favorite stock ideas right now in true round table fashion will be held on Tuesday. January 31 at 8 PM ET.


On the eve of Groundhog Day Eve, we’ll return to a tradition of visiting and reviewing a Few of Our Favorite Screens.

Stocks Likely To Be Discussed

  • Dollar Tree Stores (DLTR)
  • NIC (EGOV)
  • Under Armour (UAA)

These Are A Few Of Our Favorite Screens

The stocks selected for this program over the last six years have collectively beaten the Wilshire 5000. We seek actionable opportunities to study and pursue.

The round table knights include small company champion and Mid-Michigan Director Ken Kavula; Cy (MythBuster) Lynch; pharmaceutical scientist Hugh McManus; and Manifest Investing’s Mark Robertson who will analyze their favorite stocks. Guest damsels have included Anne Manning, Susan Maciolek and Kim Butcher. Guest knights who have jousted include Nicholas Stratigos, Herb Lemcool and Matt Spielman

Ivory Soap Screen

We feature this one during most Round Tables. It’s still Mark’s favorite as it focuses screening targets on the most important characteristics — a combination of quality and return forecast — seeking the best companies at the best prices. As shown, enter 99.44 as the minimum Manifest Investing rank and we deliver a short list of high potential stock studies.

Rt ivory soap 20170130

Cy’s Strong Workhorse Screen

This multi-purpose screen accomplishes several things, including an emphasis on that middle (medium-sized) company portion of your portfolios that supports size diversification. As he often reminds us, Cy prefers companies with high quality (excellent or greater than 80) AND high financial strength (A+ or greater than 80 or 90). In this case, he’s also moderated the return forecast target a bit (MIPAR +4.5%, as shown) in order to identify some solid returns from some companies in the steady growth segment (7-12% growth) that some of us might refer to as the “workhorse zone.”

Rt workhorses 20170130

Kurt’s Sweet Spot & High Quality Screen

This one might be easiest — and among the more effective — of all. Kurt provides a continuously running screening result as one of our menu items. Click on Research > Companies and you get a current listing of potentially compelling studies.

Rt sweet spot quality 20170130

(Broad Assets) Launch Pad Concept Screen

This approach was explored in our Escape Velocity cover story (May 2014) where we attempted to explain some of the success of our 3-time group champions, Broad Assets of St. Louis. Part of the success was attributed to stocks like Lannett (LCI) which delivered massive returns, apparently operating near the point in a companies life cycle where EPS first break through into positive numbers and early stage growth can be powerful.

So three elements are probably important:

  • Double digit growth — to isolate newer, promising companies with higher growth expectations.
  • Exorbitant Slope on the EPS graphic. We screened for 2017 EPS vs. 2016 EPS here. The average is 11.4%. (FYI)
  • Price Explosion Potential — The 1-year total return via ACE forecasts. The median forecast is 7.9%.

This could be a source of “different” ideas and would be considered part of a speculative component, by many.

Rt launch pad 20170130

Hugh’s 52-Week Low Proximity Screen

You can read more about this approach here and here.

Hugh scans a relatively short list of vetted companies and pounces on them when they get within 20% of 52-week lows — so long as their good/excellent characteristics persist.

Rt hugh ann low 20170130

Ken’s Quality Small Companies

Ken Kavula reminds us that we don’t have to compromise on quality when it comes to maintaining the small company component. This dashboard, inspired by the Forbes Best Small Companies, and published by Manifest Investing back around Halloween 2016 continues to flag opportunities. It has been sorted by Quality (Descending) and a number of sweet spot (and Speculative) opportunities are displayed.

Rt small companies 20170130

Global Treasures

From January:

During his webcast on 1/10/2017, DoubleLine’s Jeff Gundlach suggested a search for equity opportunities in international baskets/markets and specifically called out India and Japan’s NIKKEI as potential targets.

We’ve been noticing a certain trend, alongside Mr. Gundlach, in recent weeks as the stocks featured in our Fave Five have been “dominated” by non-U.S. companies. Six of the last nine new editions to our Fave Five tracking portfolio (since 11/11/2016) have been ex-U.S. stocks.

IShares MSCI EAFE ETF (EFA) offers broad, market-cap-weighted exposure to large- and mid-cap stocks across 21 developed markets outside the United States and Canada. Holdings include Nestle (NSRGY), Roche (RHHBY), Novartis (NVS), Toyota (TMC), Siemens (SIEGY), GlaxoSmithKline (GSK) and Bayer (BAYRY). As the accompanying chart shows, this index (orange area) peaked 10 years and has experienced its own lost decade since the Great Recession.

If you can discover one of these with strengthening fundamentals and you believe that the global recession will abate eventually, there could be considerable opportunity here.

S&P “Strong Buy” (5-Star) Long & Short

This screen is limited to S&P 5-Star qualifiers and is sorted by price-to-fair value (P/FV) ascending. The 1-year total return is included for a look at short term expectations.

Rt sp 5star screen 20170131

Round Table (November 2016)

November Round Table

Our Round Table, a monthly session featuring our favorite stock ideas right now in true round table fashion, was held November 29.

Stocks Discussed

  • CVS Health (CVS)
  • Infosys Tech (INFY)
  • Mercadolibre (MELI)

The stocks selected for this program over the last six years have collectively beaten the Wilshire 5000. The excess return (annualized) has been ranging from 2-3%. We seek actionable opportunities to study and pursue.

The agenda will also include a continuation of our selling decision concept based on relative return.

The round table knights include small company champion and Mid-Michigan Director Ken Kavula; Cy (MythBuster) Lynch; pharmaceutical scientist Hugh McManus; and Manifest Investing’s Mark Robertson who will analyze their favorite stocks. Guest damsels have included Anne Manning, Susan Maciolek and Kim Butcher. Guest knights who have jousted include Nicholas Stratigos, Herb Lemcool and Matt Spielman.

The audience selected CVS Health (CVS).

Positions closed/sold: Knight Transportation (KNX), Landauer (LDR), PRA Group (PRAA), US Physical Therapy (USPH)

The tracking portfolio has been updated at:

Rt poll 20161129

Nordstrom (JWN)

This is a sample stock analysis, the type of feature that we regularly share with subscribers at  Stocks selected during our FREE/public monthly webcasts known as our Round Table have outperformed the market (Wilshire 5000) for over 5 years.  FREE test drives and trial subscriptions available. If you’d like to be added to a reminder list for future monthly Round Tables, send a request to


Here’s a quick look at Nordstrom (JWN). It’s a quality company, but the sagging profitability is a concern. These return forecasts should make it clear why it was “sold” from the Round Table tracking portfolio after only five months — but after it had delivered gains greater than 40%.

Note the return forecast (PAR) in the chronicle and the erosion of quality. This is also an example of a company going from forecast excess returns (pink shaded area, projected relative return) to sub-zero where the stock is projected to lag the market over the long term.

Jwn eagle 20161025

This Week at MANIFEST (10/28/2016)

“Americans eat approximately 100 Acres of pizza every day. That’s about 350 slices per second.” Source: Pizza Fun Facts via

October is National Pizza Month. This observance began in October 1984, and was created by Gerry Durnell, the publisher of Pizza Today magazine. Some people observe National pizza month by consuming various types of pizzas or pizza slices, or going to various pizzerias. During the month, some pizzerias give away free pizzas or pizza slices to customers or offer reduced-price promotions. Some businesses run fundraising drives, donating proceeds of pizza sales to benefit various organizations or charities.

The acres of pizza mention took me back to a keynote speech by Ken “Mr. NAIC” Janke that he delivered to an audience of long-term investors in Chicago back in March 1996. It was entitled, The Janke Dozen and 75 Acres of Pizza (Per Day) and I saved his commentary under “Investment Club Lessons.”

At the time, our first grader did his part. Alex contributed to the national average for pizza consumption as often as we allowed him to. The staples of his diet were pizza, chicken sandwiches, pizza, macaroni & cheese, and pizza. Ken shared a number of observations including the statistic that Americans then consumed 75 acres of pizza per day. Twenty years later, we’ve apparently achieved the next digit, topping 100 acres.

Janke made another comment, in passing, that caught my attention. He pondered, thinking out loud, about the legacy of these investment education events and the various companies that he met over the years. “I became aware of some wonderful companies and investment opportunities. In fact, I suspect that a mutual fund built from the presenters and sponsoring companies would have done quite well in the long term scheme of things.”

He spent a few moments talking about the fact that the stock market had gone down a fairly significant amount on the preceding day. His point? The investment value of the four presenting companies at the event had actually gone up. He touched on one of his favorite subjects… the long-term perspective and “When to Buy Stocks.” The consistent response? “Now. Today. No, not just any stock, but solid reliable firms with solid business models, exceptional quality and good prices.”

Ken then proceeded to describe some of the companies that he found “interesting” as study candidates. The attending presenting companies (American Business Products, Libbey, Synovus and General Electric) were included by default. Ken described powerful business opportunities and excellence in management at Intel. Research and development at companies like 3M was something he always found valuable and desirable. ConAgra has positioned themselves well in their market and their management seemed to anticipate opportunity. (Think ethanol, ultimately.) Disney. Powerful franchise and solid brand recognition world wide. Their recent purchase of ABC television was an example of a well-considered delivery strategy. Motorola is a leadership company that faced some tough short-term challenges. Johnson & Johnson and Abbott Labs have good products, a good track record and good people. Hannaford Brothers, an east coast food supermarket chain, was featured in Better Investing magazine and delivered solid returns until ultimately acquired.

The S&P 500 increased by 16.6 percent in the subsequent five years. Over the same time frame, 8% of equity mutual fund managers managed to stay ahead of the market. How did the “Janke Dozen” perform? The twelve stocks gained some 35 percent.

Ken openly admitted that he had no idea how much pizza Americans would eat in the future. He did know that our analysis, patience, discipline and time-honored approach to investing would often lead us to rewarding opportunities.

Make it so. Engage the possibilities. Pass the deep dish. Shop well.

MANIFEST 40 Updates

  • 20. Coach (COH)
  • 38. Wal-Mart (WMT)
  • 40. Costco Wholesale (COST)

Round Table Stocks

  • Coach (COH)
  • Costco Wholesale (COST)
  • Dollar Tree Stores (DLTR)
  • Fossil (FOSL)
  • Hibbett Sporting Goods (HIBB)
  • Michael Kors (KORS)
  • Nordstrom J.W. (JWN)
  • Pricesmart (PSMT)
  • Ulta Salons (ULTA)
  • Vera Bradley (VRA)

Best Small Companies

  • 9. Monro Muffler (MNRO)
  • 20. Francesca’s (FRAN)
  • 22. IMAX (IMAX)
  • 27. TUMI Holdings (TUMI)
  • 39. Five Below (FIVE)

Results, Remarks & References

Companies of Interest: Value Line (10/28/2016)

The average Value Line low total return forecast for the companies in this week’s update batch is 7.8% vs. 4.5% for the Value Line 1700 ($VLE).

Materially Stronger: DSW (DSW), Iconix Brands (ICON), Ulta Salon (ULTA)

Materially Weaker: Express (EXPR), GNC Holdings (GNC), Fred’s (FRED), Rent-A-Center (RCII), Vitamin Shoppe (VSI), Perry Ellis (PERY), Monro Muffler (MNRO)

Discontinued: Mattress Firm (MFRM), Tumi Holdings (TUMI)

Market Barometers

Value Line Low Total Return (VLLTR) Forecast. The long-term low total return forecast for the 1700 companies featured in the Value Line Investment Survey is 4.5%, unchanged from last week. For context, this indicator has ranged from low single digits (when stocks are generally overvalued) to approximately 20% when stocks are in the teeth of bear markets like 2008-2009.

Stocks to Study (10/28/2016)

The Long & Short. (October 28, 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 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” Outlook: 1-year total return forecast based on most recent price target issued by Goldman Sachs.

October Round Table October 25, 2016 at 8:30 PM ET ONLINE

Stocks Featured: TBD

The Round Table tracking portfolio has beaten the market by 3-4 percentage points over the last five years. Consider joining Ken Kavula, Hugh McManus and Mark Robertson as they share their current favorite stock study ideas.

We will be continuing the discussion of the relative return-based selling guideline for portfolio management.


Investing: 2017 & Beyond October 29, 2016 at 9 AM ET Cincinnati, Ohio

  • Overview of Analysis (We’ll actually do a case study — walking through the analysis with exposure to our favorite resources and research.)
  • “Common Ground” – How investment clubs take care of a portfolio. We’ll review portfolio design and discuss management considerations. What is effective stock “watching?” How can we best be vigilant for opportunities and threats to our holdings?
  • “Discovery” – A demonstration of various screening resources with a look at some of our favorite resources.
  • “An Industry Study” – Taking a discovery and putting it through its paces to ensure that we’re considering (or accumulating and retaining the best of the best)
  • Let’s Talk Stocks – An interactive, audience-driven discussion of specific study ideas and case studies.

But not necessarily in that order … and we’ll likely add an emphasis on the 50 Best Small Company list.


Round Table (June 2016)

Our monthly webcast featuring some actionable stock ideas and exploration of some portfolio design & management concepts is tonight, June 28, at 8:30 PM ET.  The following are some of the likely stocks for discussion and some screening results to generate some ideas …

Stocks Likely To Be Discussed

  • Mesa Labs (MLAB)
  • Robert Half (RHI)
  • Biogen (BIIB)


The session starts at 8:30 PM ET. We commonly “open the doors” to the Green Room at approximately 8:15 PM ET for open discussion and socializing. All are welcome. Register via:

Some Screening Results

This daily update lists the tickers of the stocks that became 5-star investments, according to Morningstar, as of the last market close. A stock is awarded 5 stars when its price hits what Morningstar deems is a “Consider Buying” level.

As is often the case, 2-3 horrific days in the stock market leads to a more extensive list. (A typical day has 1-3 entries)

Tracking Dashboard

We’ll follow $100 into each one of these ideas via:

Ivory Screen Stock Search (6/28/2016)

Based on MANIFEST Ranking greater than 99.44 … the MANIFEST Rank is an equally-weighted index based on (1) total return forecast and (2) quality ranking. It represents the top half of the top percentile of current study opportunities.

Ivory screen 20160628