Round Table: Last Call!

The February Round Table will get underway at 10:30 AM ET as our noble knights and damsels gather on the red carpet and mingle in the Green Room — sponsored by Caesarstone. The Pavilion management team would like to thank the overnight campers for not building a campfire on the red carpet and for maintaining order while celebrating with your “tailgate among the Golden Knights.”

Stocks likely to be discussed:

  • Apple (AAPL)
  • Caesarstone (CSTE)
  • Cognizant Technology (CTSH)
  • Fossil (FOSL)
  • Stericycle (SRCL)
  • Walgreen (WAG)

Come out for this FREE webcast and see how many Golden Knight statues that Ken Kavula and Hugh McManus abscond again this year.

Register via: http://www.manifestinvesting.com/events/143-round-table-march-1-2014

Walgreen (WAG)

Walgreen (WAG) will likely be suggested as a sell candidate during the February Round Table. The recent surge in stock price ($68) results in a return forecast of approximately 3%. The August-2010 selection was the first Best Selection winner at the first red carpet gala. WAG has been selected by three of us, with the four most recent selections by Hugh McManus.

The stock is overbought with a relative strength index (RSI) of 79.6 and momentum (ROC) is considerable as the stock price has advanced 70.3% over the trailing 12-months.

Make no mistake.

This is an excellent company — and it has been very, very good to us.

Our $7000 invested in Walgreen in the Round Table tracking portfolio is now worth $15,801.

Closing out these positions will lock down 7-of-the-top-20 all-time results for our Round Table since inception.

What is your outlook on Walgreen? Would you sell? Would you consider covered calls for an exit strategy?

Value Line Low Total Return Screen (3/22/2013)

 

Companies of Interest

The average low total return forecast for Issue 5 is 7.0% — so there are some shopping opportunities in the group. (Reminder: The companies displayed in the screening results are limited to the top two quality ranking quintiles, or greater than 60)

Nu Skin (NUS) is a somewhat speculative study but displays some promising characteristics. I’m reminded of Laura Berkowitz’s timeless “Confessions of a SafeSkin Buyer” published years ago in Better Investing and wonder if the study shouldn’t include a threats and opportunities analysis of single-product companies, fads … and the like.

Gentex (GNTX) is a potential study in conflicted consensus. Morningstar thinks the price-to-fair value ratio for GNTX is 74% (attractive). S&P thinks the P/FV is 103% (fairly/fully valued). Go ahead. Rumble. What do you think?

Walgreen (WAG) and CVS Caremark (CVS) continue their leadership campaign and compete with each other. Both companies remain attractive from a return perspective and the fundamentals at CVS have strengthened of late — now topping WAG in the quality ranking. S&P sees opportunity with a P/FV of 74% for CVS.

Materially Stronger: Arris Group (ARRS), Cisco Systems (CSCO)

Materially Weaker: Acme Packet (APKT), Broadcom (BRCM), Tellabs (TLAB), Alaska Communications (ALSK)

Market Barometers

The Value Line median low total return forecast is 6.8%, down slightly from last week’s 6.9%.

Chuck Allmon & MOCON (MOCO)

The 9th stock in our annual Christmas Countdown is MOCON (MOCO) an all-time favorite of champion long-term investor Charles Allmon. MOCON is the type of company that can provide a solid contribution from smaller (and generally faster-growing) companies as we balance our selections.

And in this case, MOCON makes measurement, analytical and monitoring consulting products and services worldwide.

A little monitoring seems to be in order for one of our countdown favorites featuring the calling birds in the accompanying image. I could be wrong, but I think the solitaire-playing calling bird has a bluetooth. (Grin)

I think MOCON is suffering one of those occasional speed bumps that any and all companies experience during their life cycle. 2012 will be unkind. But it’s interesting to note that the “P” has not fully followed the “E” in the visual analysis. That’s an indication of faith in the long term and a return to the longer term trend for the core characteristics.

MOCON also gives us the chance to nod in the direction of Charles Allmon. Chuck, known by many of us as dancing bear — is clearly one of the most successful stock pickers that few know and/or talk about. I know that many of you are an exception to that and celebrate/cherish Chuck’s contributions to the pages of Better Investing magazine over the years.

A little while ago we looked at a portfolio published in Forbes near his the date of his retirement and we can still marvel at the results and track record.

How To Pick A Growth Stock

MOCON wasn’t in this Growth Stock Outlook feature, but ISNS (a fairly similar company) was. The portfolio has been captured and preserved at:

http://www.manifestinvesting.com/dashboards/public/dancing-bear

Since November 2008, $1200 has become $3604 … an annualized rate of return of 30.8% and a relative return of +10.3% versus the Wilshire 5000. Yes, Virginia, you’re permitted to applaud.

When it comes to stock selection and phoning-a-friend, the smartest calling birds that I know would dial up Charles “Dancing Bear” Allmon in a heartbeat.