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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, no Dow30 stocks are trading below 
their benchmark score. Note, 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 live basis.


Market Valuation (Dow 30): 
The market remains very overvalued currently, at least according to the BI method of valuation.
Downside: -46%
Upside:   -21%

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	16-Feb-18	149	TRUE	90	149	66%	224%	25%	 2.1 	165	225	32%	FALSE	Caterpillar Inc.
JNJ	16-Feb-18	127	FALSE	100	129	27%	59%	21%	 2.8 	170	210	49%	FALSE	Johnson & Johnson
MCD	23-Feb-18	158	FALSE					14%	 2.6 	180	220	27%	TRUE	McDonald's Corp.
CVX	2-Mar-18	115	FALSE	49	67	135%	278%	53%	 3.9 	120	145	16%	FALSE	Chevron Corp.
XOM	2-Mar-18	73.78	TRUE	44	57	70%	96%	16%	 4.3 	100	125	53%	FALSE	Exxon Mobil Corp.
BA	9-Mar-18	327	FALSE					37%	 2.1 	350	425	21%	TRUE	Boeing
TRV	9-Mar-18	138	FALSE	91	119	53%	111%	48%	 2.1 	175	215	41%	FALSE	Travelers Cos.
UNH	9-Mar-18	218	TRUE	138	209	58%	119%	24%	 1.4 	225	275	16%	TRUE	UnitedHealth Group
VZ	16-Mar-18	47.02	FALSE	37	49	28%		20%	 5.0 	80	95	86%	FALSE	Verizon Communic.
CSCO	16-Mar-18	44	TRUE	27	39	65%	71%	11%	 3.1 	50	65	33%	TRUE	Cisco Systems
HD	23-Mar-18	176	FALSE				132%	26%	 2.4 	210	255	32%	TRUE	Home Depot
PG	23-Mar-18	76.3	TRUE	66	85	16%	25%	8%	 3.6 	105	130	53%	TRUE	Procter & Gamble
INTC	30-Mar-18	52.38	TRUE	36	53	47%	74%	2%	 2.4 	80	95	72%	FALSE	Intel Corp.
AAPL	30-Mar-18	172	TRUE	93	200	85%	90%	22%	 1.8 	50	320	64%	FALSE	Apple Inc.
IBM	30-Mar-18	153	TRUE	115	156	33%	33%	-2%	 4.1 	175	215	28%	FALSE	Int'l Business Mach.
DWDP	5-Jan-18	64.3	TRUE					252%	 2.4 	65	90	25%	TRUE	DowDuPont Inc.
MRK	5-Jan-18	53.88	FALSE	40	58	34%	33%	6%	 3.6 	70	85	43%	FALSE	Merck & Co.
PFE	5-Jan-18	34.96	FALSE	32	43	10%	50%	-43%	 3.8 	45	55	40%	TRUE	Pfizer Inc.
GE	12-Jan-18	12.82	FALSE	13	20	1%	-32%	0%	 3.6 	30	40	199%	FALSE	Gen'l Electric
MMM	12-Jan-18	220	FALSE	140	196	57%	85%	7%	 2.4 	240	290	41%	FALSE	3M Company
UTX	12-Jan-18	126	TRUE	86	117	48%	56%	3%	 2.3 	140	170	28%	FALSE	United Technologies
GS	12-Jan-18	254	FALSE	165	273	54%	84%	11%	 1.2 	290	355	47%	FALSE	Goldman Sachs
KO	19-Jan-18	42.66	FALSE	35	44	22%	34%	7%	 3.7 	45	55	40%	FALSE	Coca-Cola
WMT	26-Jan-18	87.48	FALSE	58	77	51%	61%	9%	 2.4 	110	135	40%	FALSE	Walmart Inc.
NKE	26-Jan-18	65.78	TRUE	49	70	35%	36%	25%	 1.2 	75	90	28%	FALSE	NIKE Inc. 'B'
DIS	2-Feb-18	100	TRUE	92	128	8%	12%	11%	 1.7 	120	145	71%	FALSE	Disney (Walt)
JPM	9-Feb-18	111	TRUE	72	111	53%	82%	31%	 2.1 	85	120	-6%	FALSE	JPMorgan Chase
AXP	9-Feb-18	92.41	TRUE	78	116	19%	38%	21%	 1.6 	105	130	44%	FALSE	Amer. Express
V	9-Feb-18	120	TRUE	92	133	30%	60%	19%	 0.7 	115	140	6%	FALSE	Visa Inc.
MSFT	9-Feb-18	93.5	TRUE	43	63	116%	157%	22%	 1.9 	90	110	0%	FALSE	Microsoft Corp.
Dow30		        24,140	       12,935  19,020	                         2.4  26,578  34,599			Dow Jones Industrial Average
Appreciation Potential		  	 -46%	   -21%				          10%     43%     42%


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 my past month’s CAPS portfolio: 
KMI was purchased. It stands at -38% below its downside price target.
AYI will likely be purchased soon. It currently stands at -24% below its downside price target.

My overall Fool CAPS Rating at the time of this post was 69
Score: 1,604 (79th percentile)
Accuracy: 46% (39th 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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