Best & Worst ETFs & Mutual Funds: Financials Sector

The Financials sector ranks ninth out of the ten sectors as detailed in my Sector Rankings for ETFs and Mutual Funds report. It gets my Dangerous rating, which is based on aggregation of ratings of 44 ETFs and 230 mutual funds in the Financials sector as of October 7, 2013. Prior reports on the best & worst ETFs and mutual funds in every sector are here.

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New Stocks Make Most Attractive/Dangerous Lists

October sees 13 new stocks make our Most Attractive list and 16 new stocks fall into the Most Dangerous category. Our Most Attractive stocks have high and rising return on invested capital (ROIC) and low price to economic book value ratios. Most Dangerous stocks have misleading earnings and long growth appreciation periods implied in their market valuations.

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Best & Worst ETFs & Mutual Funds: Consumer Staples Sector

The Consumer Staples sector ranks first out of the ten sectors as detailed in my Sector Rankings for ETFs and Mutual Funds report. It gets my Attractive rating, which is based on an aggregation of ratings of eight ETFs and eight mutual funds in the Consumer Staples sector as of October 3, 2013. Prior reports on the best & worst ETFs and mutual funds in every sector are here.

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Best & Worst ETFs & Mutual Funds: Consumer Discretionary Sector

The Consumer Discretionary sector ranks third out of the ten sectors as detailed in my Sector Rankings for ETFs and Mutual Funds report. It gets my Neutral rating, which is based on aggregation of ratings of 17 ETFs and 21 mutual funds in the Consumer Discretionary sector as of October 4th, 2013. Prior reports on the best & worst ETFs and mutual funds in every sector are here.

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Rating Breakdown: Best & Worst ETFs & Mutual Funds by Sector

This report focuses on my top picks and pans for all sector funds. I will follow this summary with a detailed report on each sector.

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Danger Zone 10/7/13: Utility Sector Funds

Utility sector ETFs and mutual funds are in the Danger Zone this week. The Utility sector edged out the Financials sector to rank last among all ten sectors in my 4Q13 Sector Rankings report.

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Sector Rankings For ETFs & Mutual Funds

At the beginning of the fourth quarter of 2013, only the Consumer Staples sector earns an Attractive rating. My sector ratings are based on the aggregation of my fund ratings for every ETF and mutual fund in each sector.

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30+ Accounting Adjustments to Get the Truth About Earnings & Valuation

Reported earnings don’t tell the whole story of a company’s profits. They are frequently manipulated by companies to manage earnings.

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Danger Zone 9/30/13: Zynga (ZNGA)

The stock has been beat up since its much-hyped IPO in 2011, but even after losing 61% of its value the stock is still too expensive. ZNGA is competing in an immature market where the barriers to entry are almost nonexistent and brand loyalty is a foreign concept.

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Unconsolidated Subsidiary Assets – Valuation Adjustment

Investors who ignore unconsolidated subsidiary assets are not getting a true picture of the cash available to be returned to shareholders. By adding unconsolidated subsidiary assets one can better understand the value of the stock to shareholders. Diligence pays.

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CNBC Interview: Confirming AAPL Thesis – Apple Is Still Rotten

Here’s my latest CNBC interview on my Apple (AAPL) thesis, originally articulated in Danger Zone 5/13/2013: Apple Inc. (AAPL).

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Danger Zone 9/23/13: InnerWorkings (INWK)

InnerWorkings (INWK), a new addition to the Most Dangerous Stocks for September, is in the Danger Zone this week. INWK is a classic “roll-up” story that enriches corporate and Wall Street insiders while destroying shareholder value.

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Index Investing Myth Buster: Tom Brakke

Tom Brakke recently featured our Dangers Zone article on FVL. His article highlights the lack of performance of FVL versus other true index funds and supports my thesis.

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Non-Operating Unconsolidated Subsidiaries—Invested Capital Adjustment

This report is one of a series on the adjustments we make to convert GAAP data to economic earnings. This report focuses on an adjustment we make to convert the reported balance sheet assets into invested capital.

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GM’s Long Range EV A Further Threat to Tesla

On Monday, GM announced their plan to develop an all-electric vehicle that could go 200 miles per charge, just like Tesla’s Model S. The catch? GM plans to sell their car for only $30,000, less than half of the $62,000 sticker price for the Model S.

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Apple Stays Rotten

The “value” in Apple is an illusion. Astute investors need to look at Apple through the lens of what is a reasonable ROIC in the future.

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Wall Street Journal Features My Advice on Dividend Stocks

Popular dividend stocks could be ticking time bombs.

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GAAP Opinion versus Economic Fact

GAAP financial statements generally fail to meet equity investors’ analytical needs. We try to calculate something that does.

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The Disconnect between Investment Theory and Practice

A disconnect between investment theory and investment practice exists and is manifested in the way investors should value stocks versus the way they actually do value stocks.

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Distinctions Between “Growth” and “Value” Investment Styles Are Irrelevant

Growth without profit (i.e. value) offers no investment merit. Conversely, value without growth offers little upside incentive for investing in any business.

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