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URL:  http://boards.fool.com/jun-29-picks-30126307.aspx

Subject:  Jun 29 Picks Date:  7/1/2012  9:21 AM
Author:  AllTooFoolish Number:  5926 of 5985

I am using the following TTD rules for Long position considerations:
1. Year-over-Year EPS growth must > 10%, which is the next 4Q / current quarter + previous 3 quarters earnings results
2. VL 3-5 Year price appreciation > average price appreciation of the market
3. When calculating ROE and BV figures, ignore years when are negative, but must have at least 7+ years of data to be 
   included in final consideration
4. Avoid erratic ROE ratios, that is where they are > 2std deviations = Curr ROE > (10 Year Avg + 2 * Std Dev)

Based on these rules, the top three undervalued stocks are:
HPQ
JPM
CSCO
However, only HPQ would qualify as a TTD pick.

The top three most overvalued stocks are:
BA
VZ
PFE
None of these would qualify as a potential short position.

Market Valuation: 
Downside: -17%
Upside:   +22%


Summary of Results												
											
	VL	        Current	Down	Up	%<10Y	EPS	Div    3-5Y L 3-5Y H VL 3-5Y   ROE	
Ticker	Date	        Price	Price	Price	Down	Delta   Yield   VL $	VL $	% Chg	<2STD	Name
CAT	25-May-12	 84.96 	90.63	160	-6%	20%	2.5	145	215	111%	FALSE	Caterpillar Inc.
JNJ	25-May-12	 66.63 	55.29	70.19	21%	3%	3.7	80	100	35%	TRUE	Johnson & Johnson
MCD	1-Jun-12	 88.35 	75.30	107	17%	9%	3.2	110	130	36%	FALSE	McDonald's Corp.
CVX	8-Jun-12	 100 	100	143	0%	7%	3.6	130	160	44%	FALSE	Chevron Corp.
XOM	8-Jun-12	 82.11 	69.18	96.24	19%	1%	2.8	110	135	49%	FALSE	Exxon Mobil Corp.
BA	15-Jun-12	 71.96 	28.00	43.44	157%	-15%	2.5	90	125	50%	FALSE	Boeing
TRV	15-Jun-12	 63.35 	48.68	71.62	30%	81%	2.9	80	100	43%	FALSE	Travelers Cos.
T	22-Jun-12	 35.17 	23.88	34.64	47%	9%	5.1	40	50	28%	FALSE	AT&T Inc.
VZ	22-Jun-12	 43.95 	19.06	27.23	131%	14%	4.6	55	70	44%	FALSE	Verizon Communic.
CSCO	22-Jun-12	 17.13 	20.93	34.83	-18%	21%	1.9	30	35	91%	FALSE	Cisco Systems
HD	29-Jun-12	 52.02 	32.34	50.80	61%	12%	2.3	60	70	26%	FALSE	Home Depot
PG	29-Jun-12	 59.83 	49.53	63.69	21%	-3%	3.8	90	110	67%	FALSE	Procter & Gamble
INTC	6-Apr-12	 26.93 	30.14	52.15	-11%	4%	3.1	45	55	87%	FALSE	Intel Corp.
HPQ	6-Apr-12	 20.37 	29.38	50.16	-31%	33%	2.6	55	75	220%	FALSE	Hewlett-Packard
IBM	6-Apr-12	 193 	114	165	70%	7%	1.8	235	285	34%	FALSE	Int'l Business Mach.
AA	13-Apr-12	 8.62 	7.86	15.28	10%	68%	1.4	16	25	139%	FALSE	Alcoa Inc.
DD	13-Apr-12	 49.96 	51.28	76.55	-3%	9%	3.5	100	120	122%	TRUE	Du Pont
MRK	13-Apr-12	 40.18 	34.93	56.81	15%	-4%	4.3	45	55	26%	FALSE	Merck & Co.
PFE	13-Apr-12	 22.73 	12.77	18.82	78%	17%	3.9	25	30	21%	FALSE	Pfizer Inc.
GE	20-Apr-12	 19.81 	19.51	29.51	2%	21%	3.5	30	50	104%	FALSE	Gen'l Electric
MMM	20-Apr-12	 86.83 	73.13	102	19%	5%	2.7	130	160	67%	FALSE	3M Company
UTX	20-Apr-12	 75.20 	64.31	92.51	17%	2%	2.9	115	140	70%	FALSE	United Technologies
KFT	27-Apr-12	 38.85 	33.00	43.50	18%	15%	3.0	55	65	54%	FALSE	Kraft Foods
KO	27-Apr-12	 74.94 	63.42	85.72	18%	8%	2.7	105	130	57%	FALSE	Coca-Cola
WMT	4-May-12	 67.30 	65.56	84.05	3%	9%	2.4	80	95	29%	FALSE	Wal-Mart Stores
DIS	11-May-12	 47.47 	46.61	70.65	2%	13%	1.3	60	75	42%	FALSE	Disney (Walt)
BAC	18-May-12	 7.94 	6.48	10.02	23%	613%	0.5	12	20	104%	FALSE	Bank of America
JPM	18-May-12	 35.99 	44.84	73.90	-20%	11%	3.4	60	95	118%	FALSE	JPMorgan Chase
AXP	18-May-12	 56.79 	45.04	68.02	26%	8%	1.4	75	105	59%	FALSE	Amer. Express
MSFT	18-May-12	 30.70 	29.64	43.56	4%	8%	3.2	50	60	82%	FALSE	Microsoft Corp.
												
Dow30		        12,641 10,482  15,476                   2.9  17,506  22,251  			Dow Jones Industrial Average
Appreciation Potential		 -17%     22%			        38%     76%     69%		
					

VL Date is the date of the last summary report update from Valueline.

Current Price is the closing price of the stock as of the time mentioned in the posting description.

10Yr Down is the 10 year downside price. The company must have at least 7 years of non-negative ROE data to qualify.

10Yr Up is the 10 year upside price. The company must have at least 7 years of non-negative ROE data to qualify.

Both upside and downside are calculated using method outlined in TTD book.
Also a discussion of calculating the upside and downside can be found here:
http://boards.fool.com/Message.asp?mid=20916205&sort=who.........

%<10Y Downside is the current price divided by the 10 Yr downside expressed as a percentage.

EPS Future Delta is the projected growth in EPS for the next 4 quarters versus the last four reported quarters.
I use the latest EPS data from the VL spreadsheet which are updated as soon as new earnings are reported.

Div Yield is the current % dividend payout ratio per share.

3-5 Y Low/Hi Price Est. is the downside/upside price estimate which is calculated using the projections of Book Value 
and ROE as discussed in TTD.

Min VL Price Appreciation is the expected change in price from current price to low end VL projected 3-5 year
appreciation price.

ROE >2STD is part of a margin of safety consideration, which is briefly discussed in TTD on pg 70-71. 

I compare the current year's ROE versus the last 10 years of ROE data. If the current ROE is greater than average(10 Yr
ROE) + (2 * stdev(10 Yr ROE)), than this column is TRUE, else it is FALSE. This tells me that the stock's ROE is much
higher than its historic average.

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