January 14, 20150Comments

Add the Best Consumer Discretionary Stocks to Your Portfolio

The Consumer Discretionary sector ranks fourth out of the 10 sectors for the first quarter of 2015 and receives our Neutral rating. The Consumer Discretionary sector as a whole underperformed the S&P 500 in 2014, rising 9% to the S&P’s 12%.

by Kyle Guske II, Senior Investment Analyst, MBA

January 5, 20150Comments

Danger Zone: Make Sure You’re in These Two Stocks for 2015

Instead of our usual weekly sell/short call, we are going to open 2015 with two of our favorite stocks for the upcoming year. These stocks have strong growth potential in the coming year, and are attractively valued, trading below their economic book values.

by Andre Rouillard

December 18, 20140Comments

10 New Stocks Added to Most Attractive List for December

Our Most Attractive Stocks (+1.1%) underperformed the S&P 500 (+2.2%) last month.

by Kyle Guske II, Senior Investment Analyst, MBA

August 20, 20140Comments

How to Avoid the Worst Sector Mutual Funds

Picking from the multitude of sector mutual funds is a daunting task.

by David Trainer, Founder & CEO

May 13, 20140Comments

Ford (F) is Hitting on All Cylinders

As long as Ford’s strong profit growth and market share gains continue, this stock has a lot of upside.

by David Trainer, Founder & CEO

April 8, 20140Comments

Consumer Discretionary Sector

The Consumer Discretionary sector ranks fourth 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 18 ETFs and 21 mutual funds in the Consumer Discretionary sector as of April 2, 2014.

by David Trainer, Founder & CEO

March 28, 20142Comments

NOPAT Adjustment: Foreign Exchange Loss

NOPAT Adjustment: Foreign Exchange Loss. Converting GAAP data into economic earnings should be part of every investor’s diligence process. Performing detailed analysis of footnotes and the MD&A is part of fulfilling fiduciary responsibilities.

by David Trainer, Founder & CEO

March 12, 20140Comments

New Stocks Make Most Attractive/Dangerous Lists For March

Momentum chasing is never a good strategy. RCL significantly outperformed the market last year, while F lagged it slightly, but don’t expect those trends to continue in 2014 for either stock.

by David Trainer, Founder & CEO

September 19, 20132Comments

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.

by David Trainer, Founder & CEO

August 2, 201310Comments

Deferred Tax Assets and Liabilities – Invested Capital Adjustment

DTAs artificially raise reported assets and do not help generate operating profit while DTLs are like a source of interest-free financing. We remove the impact of DTAs and DTLs from our calculation of invested capital to ensure the more accurate measure of a firm’s return on invested capital (ROIC).

by David Trainer, Founder & CEO

July 22, 20130Comments

Asset Write-Downs – Invested Capital Adjustment

For debt investors, which GAAP was primarily designed for, write-downs are analytically helpful. They provide a more accurate assessment of the liquidation value of a company’s assets. For equity investors, on the other hand, write-downs are not helpful because they distort the return on invested capital (ROIC) of a company.

by David Trainer, Founder & CEO

July 11, 20130Comments

AOCI Removed from Invested Capital – NOPAT Adjustment

Reported assets don’t tell the whole story of the capital invested in a business. Accounting rules provide numerous loopholes that companies can exploit to hide balance sheet issues and obscure the true amount of capital invested in a business.

by David Trainer, Founder & CEO

February 13, 20130Comments

Best & Worst ETFs and Mutual Funds February 2013: All-cap Value Style

The all-cap value style ranks seventh out of the twelve fund styles as detailed in my Style Rankings for ETFs and Mutual Funds report. It gets my Dangerous rating, which is based on aggregation of ratings of two ETFs and 270 mutual funds in the all-cap value style as of February 7th, 2013.

by David Trainer, Founder & CEO

May 10, 20110Comments

Show Discretion When Choosing Consumer Discretionary Sector ETFs

Retail HOLDRS (RTH) is our top pick for consumer discretionary sector ETFs. RTH is one of 51 ETFs that gets an attractive-or-better rating. We rate the investment merit of the

by David Trainer, Founder & CEO

March 1, 20114Comments

Red Flag Report: Hidden Expenses/Income: What You Don’t Know Can Cost You

Most investors are not aware that companies hide one-time and unusual charges and income inside normal, operating line items (e.g. “Cost of sales”) on their income statement. These hidden items can mislead investors by artificially decreasing/increasing GAAP earnings. We found 13,000+ one-time items buried in normal line items like “Cost of Sales” by studying the Footnotes of 10-K filings from 1998 thru 2/15/2011. This research revealed that companies have concealed over $41 billion in one-time items.

by David Trainer, Founder & CEO

February 28, 20110Comments

For Ask Matt readers: Ford (F) — Dangerous Rating

Ford gets our Dangerous Rating. This means F has poor quality-of-earnings and an expensive valuation. For example, F's ROIC at 0.6% is in our Bottom Quintile. And the valuation of the current stock price ($15.07) implies the company will grow its profits at 10% compounded annually for over 40 years. The takeaway: avoid this stock.

by David Trainer, Founder & CEO

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