Photo Credit: wonderwebby (Flickr)Â
Recap from July’s Picks
Our Most Attractive Stocks (-1.9%) underperformed the S&P 500 (+0.8%) last month. Most Attractive Large Cap stock Altria Group (MO) gained 12% and Most Attractive Small Cap stock Universal Insurance (UVE) was up 13%. Overall, 14 out of the 40 Most Attractive stocks outperformed the S&P 500 in July.
Our Most Dangerous Stocks (-4.3%) outperformed the S&P 500 (-0.8%) last month. Most Dangerous Large Cap stock SINA Corporation (SINA) fell by 24% and Most Dangerous Small Cap Stock Authentidate Holding (ADAT) fell by 32%. Overall, 28 out of the 40 Most Dangerous stocks outperformed the S&P 500 in July.
The successes of the Most Attractive and Most Dangerous stocks highlight the value of our forensic accounting. Being a true value investor is an increasingly difficult, if not impossible, task considering the amount of data contained in the ever-longer annual reports. By analyzing key details in these SEC filings, our research protects investors’ portfolios and allows our clients to execute value-investing strategies with more confidence and integrity.
21 new stocks make our Most Attractive list this month. 20 new stocks fall onto the Most Dangerous list this month. August’s Most Attractive and Most Dangerous stocks were made available to members on August 5.
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 by their market valuations.
Most Attractive Stock Feature for August: Intel Corporation (INTC: $29/share)
Intel Corporation (INTC), a global semiconductor and computer processor provider is one of the additions to our Most Attractive stocks list for August and was our Stock Pick of the Week in early May.
Intel’s leading position in the global PC processor market allowed it to build a highly profitable business. Since 1998, Intel has grown after-tax profit (NOPAT) by 5% compounded annually. This long history of profit growth points to Intel’s strength and ability to adapt in the constantly changing technology market. Intel currently generates a top quintile return on invested capital (ROIC) of 21%.
