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Recommendations: 8
Based on the latest results there are two stocks in the DOW30 that meet the criteria for a Long-term hold according to the TTD methods.
The two companies meeting the TTD criteria are MMM and CSCO. Also, the downside risk in the market seems to be about -7%.
I am using the following TTD rules:
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)
Summary of Results
VL Current Down Up %<10Y EPS 3-5Y L 3-5Y H VL 3-5Y ROE
Ticker Date Price Price Price Down Delta VL $ VL $ % Chg <2STD Name
MMM 21-Oct-11 83.87 90.06 127.01 -7% 14.3% 142.47 200.92 70% FALSE 3M Company
AA 13-Jan-12 9.43 11.16 21.14 -15% -30.9% 27.40 51.92 191% FALSE Alcoa Inc.
AXP 18-Nov-11 48.39 56.73 90.57 -15% 8.4% 76.69 122.42 58% FALSE Amer. Express
T 23-Dec-11 29.66 24.72 36.64 20% 4.7% 35.90 53.20 21% FALSE AT&T Inc.
BAC 18-Nov-11 6.27 0.91 1.38 588% 318.2% 14.03 21.20 124% FALSE Bank of America
BA 16-Dec-11 74.53 48.57 79.06 53% -4.0% 78.95 128.51 6% FALSE Boeing
CAT 25-Nov-11 97.10 78.43 138.34 24% 25.5% 154.42 272.38 59% FALSE Caterpillar Inc.
CVX 9-Dec-11 109.49 120.96 174.48 -9% -2.7% 129.93 187.42 19% FALSE Chevron Corp.
CSCO 23-Dec-11 18.97 23.55 43.16 -19% 33.3% 32.89 60.29 73% FALSE Cisco Systems
KO 28-Oct-11 68.93 68.19 94.80 1% 11.4% 90.39 125.67 31% FALSE Coca-Cola
DIS 11-Nov-11 39.75 34.66 54.18 15% 22.0% 67.63 105.73 70% FALSE Disney (Walt)
DD 13-Jan-12 46.43 53.54 79.85 -13% -1.0% 82.32 122.78 77% FALSE Du Pont
XOM 9-Dec-11 85.50 88.04 122.87 -3% 0.0% 110.35 154.00 29% FALSE Exxon Mobil Corp.
GE 21-Oct-11 18.86 18.44 28.69 2% 16.8% 36.47 56.75 93% FALSE Gen'l Electric
HPQ 6-Jan-12 26.44 31.99 55.16 -17% -2.1% 57.40 98.97 117% FALSE Hewlett-Packard
HD 30-Dec-11 43.23 31.42 50.29 38% 13.8% 41.99 67.22 -3% FALSE Home Depot
INTC 6-Jan-12 25.47 37.90 68.60 -33% 0.9% 45.27 81.93 78% FALSE Intel Corp.
IBM 6-Jan-12 181.59 149.05 220.83 22% 8.8% 230.23 341.11 27% FALSE Int'l Business Mach.
JNJ 25-Nov-11 64.93 70.74 91.84 -8% 4.5% 86.37 112.13 33% TRUE Johnson & Johnson
JPM 18-Nov-11 35.30 52.45 87.76 -33% -8.7% 70.09 117.26 99% FALSE JPMorgan Chase
KFT 28-Oct-11 37.72 33.66 44.19 12% 14.2% 47.63 62.54 26% FALSE Kraft Foods
MCD 2-Dec-11 99.64 71.56 102.99 39% 9.4% 91.93 132.31 -8% TRUE McDonald's Corp.
MRK 13-Jan-12 38.39 39.99 66.59 -4% 2.7% 37.94 63.18 -1% FALSE Merck & Co.
MSFT 18-Nov-11 27.74 39.40 60.09 -30% 2.4% 60.78 92.69 119% FALSE Microsoft Corp.
PFE 13-Jan-12 21.82 14.30 21.03 53% 20.3% 22.65 33.31 4% FALSE Pfizer Inc.
PG 30-Dec-11 66.64 52.88 69.30 26% 9.6% 80.43 105.40 21% FALSE Procter & Gamble
TRV 16-Dec-11 59.69 28.54 42.65 109% 64.8% 76.32 114.02 28% FALSE Travelers Cos.
UTX 21-Oct-11 74.10 65.60 97.42 13% 10.5% 93.64 139.08 26% FALSE United Technologies
VZ 23-Dec-11 38.37 18.65 26.69 106% 12.8% 26.57 38.03 -31% FALSE Verizon Communic.
WMT 4-Nov-11 59.18 71.96 93.48 -18% 12.1% 98.51 127.96 66% TRUE Wal-Mart Stores
Dow30 12,393 11,565 17,340 17,010 25,659 Dow Jones Industrial Average
Appreciation Potential -7% 40% 37% 107%
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 menthioned 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 at 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 is updated as soon as new earnings are reported.
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 my 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)),
then this column is YES, else it is NO. This tells me that the stock's ROE is much higher than it's historic average.
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