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No. of Recommendations: 4
This update is to Kenneth Lee’s Benchmark Investing picks based on the latest Monday’s data release. Currently, one Dow30 stocks is trading below 
its benchmark price target. That stock is DWDP, DowDuPont, which is -5% below its downslide price target. However, because there was only one 
stock below its downside price target at the end of 2017 I am not generating a 2018 BI portfolio to track. However, I will be making a post every few 
months showing the Dow30 picks and their downside targets throughout the year. If you are interested in following along with this methodology against 
a broader range of stocks outside of the Dow30, my picks are posted in the Fool CAPS on a regular basis.

Market Valuation (Dow 30): 
The market remains very overvalued currently, at least according to the BI method of valuation.
Downside: -43%
Upside:   -16%

Long Buy Rules: 
I am using the following TTD rules for Long position considerations:
1. Year-over-Year EPS growth must > 10%, which are 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)
5. ROE and BV current figures must be updated by VL to be considered.

Summary of Results

	VL	        Current	ROE/BV	Down	Up     %<10Y   %<10Y	EPS	Div    3-5Y L 3-5Y H VL 3-5Y   ROE	
Ticker	Date	        Price	Updated	Price	Price	Down	Down4Qs	Delta   Yield   VL $	VL $	% Chg	<2STD	Name
CAT	18-May-18	136	TRUE	112	185	22%	195%	27%	 2.5 	190	255	59%	FALSE	Caterpillar Inc.
JNJ	18-May-18	123	TRUE	103	133	19%	53%	1476%	 3.0 	170	210	56%	FALSE	Johnson & Johnson
MCD	25-May-18	160	FALSE					14%	 2.6 	180	220	24%	TRUE	McDonald's Corp.
CVX	1-Jun-18	123	TRUE	60	83	105%	305%	73%	 3.7 	125	155	14%	FALSE	Chevron Corp.
XOM	1-Jun-18	80.22	TRUE	49	64	64%	113%	39%	 4.1 	100	125	41%	FALSE	Exxon Mobil Corp.
BA	8-Jun-18	330	FALSE					19%	 2.2 	390	475	28%	TRUE	Boeing
TRV	8-Jun-18	124	TRUE	91	120	36%	89%	46%	 2.5 	175	215	57%	FALSE	Travelers Cos.
UNH	8-Jun-18	253	TRUE	140	212	81%	155%	21%	 1.4 	265	320	16%	TRUE	UnitedHealth Group
VZ	15-Jun-18	49.4	TRUE	34	45	46%		16%	 4.9 	80	95	79%	FALSE	Verizon Communic.
CSCO	15-Jun-18	42.16	TRUE	27	39	58%	64%	10%	 3.1 	50	65	33%	TRUE	Cisco Systems
HD	22-Jun-18	197	FALSE				159%	20%	 2.2 	215	260	18%	TRUE	Home Depot
PG	22-Jun-18	77.49	TRUE	66	85	17%	27%	8%	 3.8 	105	130	53%	TRUE	Procter & Gamble
INTC	29-Jun-18	50.86	TRUE	39	59	30%	69%	11%	 2.3 	80	95	67%	FALSE	Intel Corp.
AAPL	29-Jun-18	184	TRUE	95	204	93%	103%	19%	 1.6 	235	320	49%	FALSE	Apple Inc.
IBM	29-Jun-18	139	TRUE	114	154	22%	21%	-3%	 4.5 	170	205	32%	FALSE	Int'l Business Mach.
DWDP	6-Apr-18	65.58	TRUE	69	80	-5%		98%	 2.5 	65	90	18%	TRUE	DowDuPont Inc.
MRK	6-Apr-18	61.2	TRUE	41	58	49%	51%	1%	 3.1 	70	85	26%	FALSE	Merck & Co.
PFE	6-Apr-18	36.24	TRUE	34	45	8%	56%	17%	 3.8 	45	55	37%	TRUE	Pfizer Inc.
GE	13-Apr-18	12.86	TRUE	12	19	8%	-32%	3%	 3.8 	30	45	193%	FALSE	Gen'l Electric
MMM	13-Apr-18	194	TRUE	147	206	32%	64%	14%	 2.8 	265	325	50%	FALSE	3M Company
UTX	13-Apr-18	124	TRUE	88	121	40%	53%	4%	 2.3 	150	180	33%	FALSE	United Technologies
GS	13-Apr-18	223	TRUE	167	276	34%	61%	4%	 1.4 	305	375	49%	FALSE	Goldman Sachs
KO	20-Apr-18	43.45	TRUE	35	44	25%	36%	10%	 3.6 	50	60	27%	TRUE	Coca-Cola
WMT	27-Apr-18	86.12	TRUE	60	80	44%	59%	10%	 2.5 	115	140	51%	FALSE	Walmart Inc.
NKE	27-Apr-18	72.46	TRUE	46	66	58%	50%	13%	 1.1 	85	105	28%	TRUE	NIKE Inc. 'B'
DIS	4-May-18	105	TRUE	94	130	12%	18%	5%	 1.6 	150	180	55%	FALSE	Disney (Walt)
JPM	11-May-18	105	TRUE	77	119	36%	72%	14%	 2.2 	105	140	13%	FALSE	JPMorgan Chase
AXP	11-May-18	99.06	TRUE	81	120	23%	48%	17%	 1.5 	110	135	26%	FALSE	Amer. Express
V	11-May-18	132	TRUE	96	139	38%	76%	21%	 0.7 	155	185	26%	FALSE	Visa Inc.
MSFT	11-May-18	98.71	TRUE	46	67	115%	171%	13%	 1.7 	110	135	21%	FALSE	Microsoft Corp.
Dow30		        24,287	       13,916  20,320	                         2.5  29,883  37,044			Dow Jones Industrial Average
Appreciation Potential		  	 -43%	   -16%				          23%     53%     43%


AllTooFoolish's CAPS Portfolio: 
If you are interested in seeing this method applied to a broader universe of stocks, follow my actively managed Benchmark Investing portfolio 
using Fool CAPS. I have been using this methodology exclusively in Fool.com for many years with great success. In the Fool CAPS you will find 
my current portfolio and can see my most recent activities.

Notable activity in this quarter’s CAPS portfolio: 
WELL, April 11 added new holding to portfolio. BI Downside Price was -41%.
ALXN, added to holdings Apr 20
RRC, added to holdings May 5
AMG, May 11 added new holding to portfolio, BI Downside price was -24%
KMI, added to holdings May 28
CVS, June 11 added new holding to portfolio, BI Downside Price was -20%
AYI, added to holdings Jun 25

My overall Fool CAPS Rating at the time of this post was 70
Score: 1,644 (78th percentile)
Accuracy: 47% (44th percentile)


Disclosures and Useful Terms
VL Date is the date of the last summary report update from Valueline as indicated in the post’s subject line.
All data sources from Valueline Dow30 reports made publicly available on the VL website. https://research.valueline.com/research#list=dow30&sec=l...

Current Price is the closing price of the stock as reported by VL, which is usually a few days behind the date 
of the time period mentioned in the posting subject line.

ROE/BV Updated is an indication if the stock’s BV and ROE have been updated through the end of the Benchmark evaluation time frame.

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

10Yr Down4Qs is the 10 year downside price averaged over the previous 4 quarter’s valuation price.

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 and should therefore be avoided.
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