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Re: Stock selection using valueline survey
First of all thanks a lot for spending your valuable time for educating aspiring AIMers.
i read
http://www.aim-users.com/vlis.htm
few questions.
1) You have specified stocks with low BETA also works well with AIM. My understanding is that low BETA stocks hardly ever moves up or down relative to market ie less volatility. ???
2) insider trading - valueline only seems to give how many insider transactions have happened not the size of the transaction, don't we want to count the value of total sales - total buy rather than the number of sales. Or does valueline size up the value in the counts?
for eg. 1 buy worth 1 million vs 5 sells of few thousands.
>> Most Public Libraries will have Value Line available and >>it's usually available at most full service and some discount >>brokerages as well Most Public Libraries will have Value Line >>available and it's usually available at most full service and >>some discount brokerages as well
BTW - do you know any brokerage who provides valueline report for their customers, i couldn't find any, currently i am getting it through my library.
Thanks Tom, Good night.
Kavi.
Re:Top 100 growth stocks
So from the very fact that the stock is part of the list, preliminary analysis of the stock pretty much done, so we can just evaluate other things like stock price stability and beta, Debt ratio etc.
Kavi.
Hi Kavi, Here's the latest update in my PIC watch list on COGN................
Note that it's not quite down to its own first purchase using standard AIM settings of 10% SAFE and ~5% min. trade size.
I also made sure it was added at the PIC List site:
http://www.aim-users.com/pic.htm#COGN
Best regards, Tom
Hi Kavi, Re: Value Line's 100 shining stars.............
Your question is very good. If you note at the top of the page there in Value Line (page 39) they say,
"To be included, a company's annual growth of sales, cash flow, earnings, dividends and book value must together have averages XX% or more over the past ten years and be expected to average at least XX% in the coming 3-5 years."
So, they're accounting for that rather underwhelming book value growth in their overall calculation but how they do it is their own proprietary ideal. I guess we can surmise that the fat dividend growth rate compensates in their analysis for the low book value growth. Since we don't know their method of weighting these separate items, we can't know what the emphasis is. That they recognize Book Value Growth as a component of their analysis is good. The same is true of the higher dividend payers.
As investors we know there's different ways to achieve the "total return" we want. A zero dividend company has to perform in a different fashion than a high dividend company to achieve the same total return for us as investors. We shouldn't ignore either extreme if the total return is generous enough. Value Line's analysis brings together an interesting mix of fundamentals which in turn develops an interesting and diversified list of companies.
If we were to analyse for any of the individual components listed above (and Value Line does screen for several of them) we will find that they tend to be less diversified than this "100 Highest" list. I think this is because some industries tend to get high marks in just one area of focus by the very nature of their businesses.
So, MXIM might be strong in Dividend and Earnings growth and weak in book value growth by the nature of their business. Another company might be a huge free flow cash generator but pay no dividend. Both can make the list by their own merits. Dividends on the list currently range from zilch to 2.4%. In the past there's been some dividend payouts that were as high as 7% (Alliance Capital Management back in 2001, now AB). So the total list is a healthy one, in my opinion.
Hope this helps,
Tom
MXIM - for watch list - Book value calculation.
It is in 100 fast growing companies with timeliness of 3 currently.
Based on valueline report, future book value growth seems to be meak 5% where as everything else looks good.
But the dividend growth has been projected as 25%
How do you include dividend distribution in the equation.
If the company keeps distributing dividends would not it
reduce the book value growth?
Thanks
Kavi.
Tom - Re COGN
http://yahoo.reuters.com/stocks/QuoteCompanyNewsArticle.aspx?storyID=urn:newsml:reuters.com:20060516...
Cognos announced the U.S. Securities and Exchange Commission review and filing delay late on Monday. The review is looking into how Cognos has accounted for its support revenues and the SEC's conclusions may effect the way the company allocates revenue.
Hi Kavi, Re: COGN............
It's still an active PIC stock. I'm not sure it's on the aim-users.com site yet as I might not have uploaded it yet. I'll double check tomorrow its status.
The PIC structure was created to both demonstrate AIM's abilities and to also show a method of developing a "watch list." I'll have to read up on the SEC probe. Don't know what that's about.
Best regards, Tom
COGN - Potential PIC stock?
COGN is still part of the 100 fast growing company with timeliness 4. During the past week stock has fallen almost 20% due to pending SEC probe. I think you have mentioned before that this is a former PIC stock.
There is a good chance COGN might become timeliness 5 very quickly. How do you deal with these kind of SEC probes?
Kavi.
Good morning Kavi, Re: Short selling and stock performance.....
I've tried a number of times over the years to build a case one way or the other relative to short interest on an individual stock. Unfortunately I've never been able to develop a reliable pattern recognition that was of any predictive value. Part of that might be the relatively slow reporting of short interest.
The IW's broad brush of market conditions seems to help me and I hope it's of value to others as well. For instance, looking back at the last "low risk" period in 2004...........
we see that the S&P 500 has risen about 18% or more since that time. It also gives us a feel for whether there's that kind of upside potential available now at this time. By comparison, it appears that the market is going to have a much harder time over the next 18 months turning in that type of performance than it did over the last 18 months!
What I have found over the years is that the high risk periods with the IW can last far longer than I expect. The results are the same when the market finally does decide to decline, but the IW seems to sense the risk on the early side.
Best regards, Tom
Tom - I also looked at last week's fastest growing companies list.
INTC is still in timeliness 4 and a few more,
Lateley decent number of high quality (???) stocks are making 52 weeks low.
DELL, EBAY, BOL, PDCO.
I am trying to control my urge of buying mostly because of overall market condition and IW-suggested market bearishness.
It is good we have IW to guide us through the sea. Otherwise it would have been very hard to stay the course.
BTW, do you make any decision based on the amount of short interest a stock has? Do you consider it a postive or negative for the stocks future price. I have read both side of argument. For eg. PPC has about 21% of available stocks shorted. GNSS has about 27% shorted.
Kavi.
Good morning Kavi, Re: PIC Model Selling....
Unfortunately I only own one of those stocks in the real world! CBK is in my own account along with CGNX, PPC and APCC. Oh yes, ADCT, too. There might be another one or two.
When I started this model portfolio back in 2001 I was pretty sure it was going to be a good identifier of stocks to own for long term appreciation and possibly also volatility capture. Unfortunately at the same time my overall AIM accounts were under stress of a very large BEAR HUG. So, most of my cash reserves were already designated for the repurchase of shares of my existing holdings.
So, although I've started a few AIM accounts based on PIC's concepts, I already had a number of these same stocks in my own account. I would have started more along the way except for the cash crunch of the 2001-2003 period.
I'm always happy to see PIC active, however, even if I don't own all the stocks. It helps validate the concept. I've been eyeing the #4 Timeliness stocks that are on the "100 Highest Growth Stocks" list. There are several currently. Here, too are some great companies that are currently a bit out of favor. While it might dilute the efforts of the current PIC list to include them, it's still a good hunting ground for stocks I might potentially buy.
Best regards, Tom
Congrats! Looks like your account is running full steam
Kavi
Lots of activity in the PIC stocks recently.
Sold 35 CDNS
Sold 9 IRF
Sold 24 MTW
Sold 12 ROST
Sold 26 CBK
Sold 6 KSS
Sold 13 MOLX
No buys for a couple of weeks, but this selling is certainly making the account look healthy.
Best regards, Tom
Hey Duke, I'll be sure to boot that page back up tomorrow. I messed up the web site and blew out all the pages a while ago. Since then I've been trying to clean some of them up and all before reloading them. Vacations, etc have gotten in the way of getting it done in a timely fashion. Look again tomorrow and I'll see if I can get it working again.
Thanks for coming back for a peak. The latest of my PIC List Additions was PPC and I had a sale yesterday in that one. So far so good as that holding is only a month or two old and I've managed to pick up two sales so far.
Best regards, Tom
Tom,
Long time no see. I was curious about the PIC list. This URL shows up as 404 Not Found: http://www.aim-users.com/pic.htm
Several years, marriage and two new children have put a crimp into my investments. I'm itching to ramp up again.
Looks like I have a lot of reading to catch up on.
Good morning Kavi, Re: INTC.............
In the PIC model portfolio, AIM would be begging us to buy more of the INTC shares. The price/share at around $19-$20 is as low as it's been since late in '04. It seems trade-able with AIM between $20 and $30 and should remain so.
Best regards, Tom
New AIM account with INTC.
What do you think of starting a new account on INTC.
It is still in 100 fastest growing company list of VALUELINE.
But it has a timeliness of 4.
Is AIM recently buying INTEL?
FYI, Following friday's drop on MSFT i opened a new AIM account with MSFT.
Kaviyarasu.
Hi K, It does get tempting to go after these little jewels. Keep the lid on the cash box!
TV
Hi Kavi, Congratulations on the continuation of selling in PPC. This could get habit forming!
Best regards, Tom
Thanks Tom
I made a trip to library and browsed thru march 31 fastest growing company list. the only company that has timeliness 5 is IIVI which has gone up 15% in the last 1 week. COGN is still in timeliness 4, may be i should lock my cash box and wait for better time.
PPC another sale today.
PPC tripped another sell limit order at 27.70 before returning back to 25.65
Hi Kavi, Re: Top 100 stocks and the PIC list.........
ROST, ZQK (former PIC stock), TROW (former PIC stock), MCRS (former PIC stock), MTW, KSS, COGN, CBK, and CERN (former PIC stock) are all currently on the Top 100 Stocks. However, none of them are currently ranked #5 for Timeliness.
http://stockcharts.com/webcgi/perf.html?ROST,ZQK,TROW,MCrS,MTW,KSS,COGN,CBK,CERN
Stretch the X-axis to the full length and you'll see that these stocks have turned in pretty fair performance over time. Performance shows gains from 80% to 2000% since 1999.
Best regards, Tom
Re: CGNX
Is it still in top 100 or not?
Hi Kavi, Re: IVC.................
It's no longer on the Top 100 Growth Stocks list. I've not read up on it in a while. YOu're right, AIM's been buying shares in recent times. I'll post an updated graph tomorrow on it, if you'd like.
Best regards, Tom
Hi Kavi, Re: PIC Stocks, when to terminate............
At this point I've not terminated any of my personal holdings that have also been PIC stocks. In the "list" I have ended several. What I look for is the 3-5 year potential being too small to be worth keeping. VAlue Line updates the 3-5 year appreciation potential of the various stocks on a fairly regular basis.
I had considered dropping stocks from the PIC List because they go off the 100 highest growth list, but that was almost all of the stocks, it seemed. Plus, AIM takes time and several cycles to work its best efforts. CGNX I've owned through multiple cycles since the early '90s, for instance.
Hope this helps,
Tom
Hi Kavi, Congratulations! It's pretty rare we get two trades in the same day. Good work!
Best regards, Tom
New position with IVC
Tom
Do you think it is good time to open a position with IVC?
I was considering either IVC or CGNX, since AIM is in buying
mode in both of them. I think IVC is added in PIC list during jan 2005.
BTW, Do they still satisfy PIC rules (in 100 fast growing with timeliness 1). I should visit the library for checking the valueline report.
PIC stock re-evaluation.
I have a question.
Let us say we add a stock when it satisfies PIC conditions (one of Fastest 100 growing company in valueline with Timeliness 5). Let us say the stock loses the value, so AIM will be in buying mode. What happens it stock falls out of fastest 100 growing company list in valueline at that time? Do we drop the stock or continue with AIM or is it done case by case???
PPC - Sold twice today.
Today is a great trading day for PPC. It is up 15% today.
It tripped my first limit sale at 24.95. Then i set another limit sell order at 26.30. Surprise, it sold it again. This is the first time i have had 2 AIM directed sale on the same stock on the same trading day.
My setting is BUY SAFE - 10% , SELL SAFE - 10%
Min order size 5%
Hi Kavi, AIM helped itself to some profits today with PPC. It sold 5% of the position at $24.96 earning 17.6% gross profit on the sale.
I've reset my new buy and sell orders accordingly.
In another PIC stock holding of mine, CGNX, we did a bit of buying. We added 25% to our position at $25.50 yesterday. Our last sale in CGNX had been at $32.77, so this represents a sizable discount.
Best regards, Tom
Hi K, PPC is also in my own personal account. I decided it seemed a good idea to try 'buying from the scared!' I've been out of touch with the markets for most of this week, so will have to check when I get home.
Hope that 10% bonus helps get your account up and running in the right direction!
Best regards, Tom
What happened to PPC? It jumped 10% today.
Thanks for uncovering this stock in PIC list Tom.
I just started an AIM account on PPC last week.
Kavi.
Buy on NYT.................
Sell on MOLX.....................
Buy on IVC....................
This one seems not be anxious to find support.
Sale on IRF................
Re: Patience in the face of protracted declines..............
Keane Inc. had a stock price peak of around $18 in early 2004 and has yet to achieve a return to that earlier price. That long slide would have been hard to handle with reasonable patience for a new AIM user. Believe me, it would have been even harder for Mr. Buynhold.
With AIM's help, the value of the account now is actually higher than in 2004 even with the price/share at $15.77.
LIFO gains from this most recent cycle are excellent and overall gross profit is now showing above 100% since starting this virtual PIC holding in August of 2002. It's interesting to note at this juncture that Mr. Buynhold is also showing a double from the initial starting price. However, he's been 100% at risk the entire time to achieve that result.
AIM by comparison has only had 69.5% of its portfolio at risk on average for the entire period of time. So, AIM "Return On Capital At Risk" or ROCAR has been 148% by comparison to Mr. Buynhold.
So, AIM's been able to equal Mr. Buynhold's performance over the same time frame with significantly less risk. This is AIM's functional goal.
Best regards, Tom
MTW - One of the BEST of the PIC List...............
Just look at that Hockey Stick! I hope it brings some feelings of queaziness to any of you who still own it. Let's hope the future earnings are as generous as the estimates.
Value Line's 3-5 year estimate for the share price is $65 to $85 and its price today is over $90! I guess that means it's fully valued!
Here's what Value Line has to say:
MANITOWOC CO. (MTW; 88.30)*
Latest Report page 1357 1-27-06
Shares of machinery company Manitowoc Co. rose sharply after management raised its 2006 earnings guidance. The company now expects first-quarter and full-year share net of at least $0.82 and between $3.75 and $4.00, versus our previous estimates of $0.70 and $3.45, respectively. Strong demand from the global transportation infrastructure, energy exploration & delivery, and construction markets have significantly raised demand for mobile telescopic, tower, and crawler cranes. (Business at the Foodservice and Marine segments remains on track with management's expectations.) The better-than-expected crane demand and improving company-wide cost containment are expanding the operating and net margins. We have upped our 2006 share-earnings estimate by $0.50, to $3.95. (The annual assessment includes some $0.15 in stock option expense.) In 2007, we look for Manitowoc to earn about $5.25 a share. Manitowoc stock should at least perform in line with the year-ahead market. The recent valuation, however, severely limits the issue's appreciation potential to 2009-2011.
D.M.R.
* The earnings estimates presented herein supersede the figures found in the Summary & Index included in Issue 5 of The Value Line Investment Survey, dated 3-31-06.
Best regards, Tom
Good morning S, The PIC list is "current" through Dec. 31st of 2005. I will update it sometime in March, most likely at the end of the quarter.
There have been trades in the PIC stocks since Jan 1st. Much selling was going on in Jan. I was in the habit of posting the new PIC stocks and to post when there were trades. I should get back into that habit. Sorry for the lack of updates.
Best regards, Tom
Hi Tom,
I was wondering - Where is the current PIC List kept ? I am not sure, since this seems a couple of years old - http://www.aim-users.com/pic.htm
The 2nd question i have is - Where do you read the timeliness from - the actual "Value Line investment Survey report" ? OR is it the result of your analysis ?
Thanks,
Satbir
Here's what PPC looks like as a new model for the PIC/AIM Collection:::
Here's what VAlue Line's latest statement on it is and this might help explain the rather dramatic recent drop:
PILGRIM'S PRIDE `B' (PPC; 26.45)*
Latest Report page 1501 11-4-05
Pilgrim's Pride, a producer of prepared and fresh chicken products, has lowered its share-earnings guidance for the December quarter to $0.36-$0.41, from a range of $0.75-$0.85. Management cited weaker-than-expected performance in Mexico and lower selling prices for chicken leg quarters in the U.S. We think the dramatic decline in prices is due to two reasons: Avian bird flu concerns and a market already at a cyclical peak.
We have been warning investors for several months that the market was peaking, particularly in Mexico. The Avian bird flu, however has garnered a significant amount of the media's attention. This likely took its toll on prices, resulting in weaker-than-anticipated profit margins. Accordingly, we are reducing our fiscal 2006 (ends September 30th) earnings estimate by hefty $1.15 a share, to $2.60. Investors should note that we believe chicken prices are likely to remain volatile over the next several quarters, which may cloud Pilgrim's near-term outlook. The company already has a low Earnings Predictability rating. Therefore, we believe that investors should look elsewhere for now. Shares of Pilgrim's Pride are down more than 20% today.
G.T.M.
* The earnings estimates presented herein supersede the figures found in the Summary & Index included in Issue 6 of The Value Line Investment Survey, dated 1-6-06.
Best regards,
Tom
Another New PIC stock for AIM to assist - PPC - and it ain't chicken feed!
We're adding it to the PIC virtual portfolio at today's close of $25.70 with a cash reserve of 48%.
Back in November it was rated a #3 Timeliness with a price of $34.35 a share. Wasn't it nice of Value Line to now drop the rating to #5 as the price falls flat on its face?
This could be a reaction to the Bird Flue problem world wide. Hard to gauge.
In any case, I'll report on it in a bit more detail later.
BETA = 0.70
P/E = 9.2
Stock Price Stability = 45
LT Debt = 32% of Capitalization
Officers and Directors own 39.1% of the outstanding shares
Best regards, Tom
Hi TfourH, One of our PIC stocks just crossed its 100% gain mark while now carrying a 51% cash reserve. MTW has not offered much in the way of buying opportunities, but has continued to trip sell orders all along the way and two already this year.
It gained over 18% last year even with the heavy cash reserve. With over $10,000 in cash reserves now, it should be able to buy a mountain of shares if/when the price falls off.
I'm delighted to hear that someone else is paying attention to the PIC stocks! As a group they're doing pretty well. The sum total for 2005 was held back a bit because of several new positions starting and not enough time for them to generate much in the way of profits for the portfolio.
Best regards, Tom
thanks tom. i did well last year following your pic list. i always appreciate your generosity in sharing this information with us. you are a good man. thanks.
Re: New AIM/PIC Stock for 2006................
Cognos was added a week ago to the PIC list as it achieved a #5 Timeliness in Value Line while simultaneously being on their "100 Highest Growth Stocks" list (page 39). To be included on that list stocks need to have shown a combined growth in book value, earnings, etc. of at least 13% per year and are expected to achieve at least that going forward the next 3-5 years.
I've not spent a lot of time studying this PIC candidate, but it is debt free and has good growth history. Volatility's not bad with a BETA of 1.20 and Stock Price Stability of 30. In 2005 it had a high of about $47 and a low of $33. So, we're starting nearer the low of the last 52 weeks than the high. That's a large enough range to get AIM interested.
Please study carefully before investing.
Best regards, Tom
New PIC Stock.......................
International Rectifier (IRF) this week joins the esteemed list of Perverse Investment Candidates to be used with AIM. We are starting a virtual investment with $10,000 of virtual money split according to the iWave's current suggestion of 52% Cash and 48% invested. At $33.39 a share, this allows us to start this account with 143.756 shares and $5200 cash.
This stock has a pretty high BETA, so might turn out to be one of the better candidates we've reviewed in recent years for AIMing. A quick look at StockCharts.com shows a stock with broad and strong trends. Not a lot of choppy action, but ones that would allow multiple buys or sells in a string.
There also seems to be pretty good confirmation of trends with W%R and Accum/Distr. so we will feel pretty secure with AIM's decisions. With the heavy burden of cash here in this account, we can certainly average down a long way if the price retreats from our starting point.
So, we'll be watching to see how this one develops. Certainly it appears some of the earlier "fat" has been trimmed from this stock. Maybe we're actually getting some "value" here along with the hope of future growth.
Best regards,
Tom
CBK's up nicely today - over 4% in a nice rebound since the last time this AIM/PIC stock tripped a Buy market order.....
Best regards, Tom
Hi EIK, Re: Graphs and software.............
Good to have another AIMer on board! Thanks for posting.
You should be able to create some nice looking line and stacked bar graphs in Excel which would nearly duplicate the histograms I usually post.
The summary part of the screen and the histograms come from the software called Newport, which currently isn't available. I capture the images directly from the software, crop and paste them together to get the composites shown here. It's badly in need of being updated for the newer Windows platforms and I'm not sure it will ever be done. The author has been gathering up the info needed to possibly get the work done.
It was first developed in 1993 in DOS, updated in 1996 and "fixed" for the Millennium, but no further development was done.
The http://www.automaticinvestor.com software will create similar graphs and I'm sure there's summary screens in it as well.
I've found the images instructive when trying to show what AIM does. Seeing the cash reserve being actively used tells the story best.
Thanks for posting. Please feel free to join in on the conversations or ask questions as they might pop up.
Best regards, Tom
Tom,
sorry for primitive question, but what software produces the screenshots you use in your posts? I've been using AIM for a few years (modified Excel version), and kind of like your pictures. :) Where can I get/buy the program?
Thanks.
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