5 Highest Dividend Yields Among Undervalued Companies for the Enterprising Investor – May 2014

5ent-und-divThere are a number of great companies in the market today. By using the ModernGraham Valuation Model, I’ve selected the five highest dividend yields among the undervalued companies reviewed by ModernGraham. Each company has been determined to be suitable for Enterprising Investor according to the ModernGraham approach. This is a sample of one screen that is included in ModernGraham Stocks & Screens, which is available for premium subscribers.  Defensive Investors are defined as investors who are not able or willing to do substantial research into individual investments, and therefore need to select only the companies that present the least amount of risk. Enterprising Investors, on the other hand, are able to do substantial research and can select companies that present a moderate (though still low) amount of risk. Each company suitable for the Defensive Investor is also suitable for Enterprising Investors.

Value investors seeking to follow Benjamin Graham’s methods may also wish to review some 5 Undervalued Dow Components or 5 Lowest PEmg Companies for the Enterprising Investor while proceeding with further research of all of the following companies:

HCP, Inc. (HCP)

logoWith a dividend yield of 5.15%, HCP Inc. for now qualifies for the Enterprising Investor, which is a rather rare achievement for a REIT as normally the level of debt present eliminates them from contention.  In this case, though, the company’s current assets are high enough this quarter to push it into contention for investment.  For the Defensive Investor, the company’s PEmg ratio is too high and the current ratio is not high enough to overcome that burden.  As a result, Enterprising Investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company.  From a valuation standpoint, the company appears to be undervalued, having grown its EPSmg (normalized earnings) from $0.57 in 2009 to $1.54 for 2013.  This demonstrated level of growth is above the market’s implied estimate of 9.48% earnings growth, and the ModernGraham valuation model has returned an estimate of intrinsic value that is higher than the market price.  (See the full valuation)
HCP Chart

HCP data by YCharts

People’s United Financial, Inc. (PBCT)

PeoplesUnitedBankPeople’s United Financial has a dividend yield of 4.63% and is suitable for Enterprising Investors but not for Defensive Investors.  The Defensive Investor is concerned with the high PEmg ratio, but the company passes all of the requirements for the Enterprising Investor.  As a result, Enterprising Investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company and comparing the company to other opportunities.  As for a valuation, the company appears undervalued after growing its EPSmg (normalized earnings) from a $0.34 in 2010 to an estimated $0.71 for 2014.  This level of demonstrated growth surpasses the market’s implied estimate of 5.79% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that is well above the price at this time.  (See the full valuation)
PBCT Chart

PBCT data by YCharts

Freeport-McMoRan Copper & Gold Inc. (FCX)

500px-Freeport_McMoRan.svgFreePort-McMoran is an interesting company in the ModernGraham valuation model and has a dividend yield of 3.57%.  It does not pass the requirements of the Defensive Investor, as it has not consistently paid dividends over the last ten years, and it has not shown earnings stability over the last ten years.  But it does pass the requirements of the Enterprising Investor, though it has a higher level of debt relative to current assets than the investor type likes to see.  As a result, Enterprising Investors should feel comfortable proceeding with their research.  From a valuation perspective, the ModernGraham valuation is affected significantly by the large earnings loss in 2008, which has caused the EPSmg (normalized earnings) figure for 2009 to be very low in relation to 2013.  As it stands, the EPSmg have grown from -$1.67 to $3.48, indicating a high level of growth that would appear to significantly outpace the market’s implied estimate of 0.79% earnings growth.  This has led the model to return an intrinsic value estimate that is well above the market price, and the overall result that the company is undervalued is supported by the valuation based on only 3% growth.  (See the full valuation)
FCX Chart

FCX data by YCharts

Coach Inc. (COH)

Official_Coach_Inc_LogoCoach Inc. has a strong dividend yield at 3.22% and is a very intriguing company for Enterprising Investors, having passed all five of the investor type’s requirements.  The company does not quite qualify for the Defensive Investor due to the short dividend history and the high PB ratio.  As a result, Enterprising Investors should feel very comfortable proceeding with further research into the company.  From a valuation perspective, the company looks significantly undervalued after having grown its EPSmg (normalized earnings) from $2.03 in 2010 to an estimated $3.19 for 2014.  This demonstrated level of growth outpaces the market’s implied estimate of 2.31% earnings growth, and leads the ModernGraham valuation model to return an estimate of intrinsic value that is well above the market price.  (See the full valuation)
COH Chart

COH data by YCharts

Ford Motor Company (F)

500px-Ford_Motor_Company_Logo.svgFord Motor Company has a dividend yield of 3.14% but remains unsuitable for the Defensive Investor due to its lack of stability in earnings and dividends over the ten year period.  The Enterprising Investor looks at a much shorter time horizon, though, and the company passes all of the requirements of this investor type.  As a result, Enterprising Investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods will feel comfortable proceeding with further research.  As for a valuation, the company performs well in the ModernGraham valuation model after growing its EPSmg (normalized earnings) from -$3.60 in 2008 to $2.23 for 2013.  This solid level of growth is not reflected by the market, as the market is currently implying a growth rate estimate of -0.82%.  In other words, the market price indicates an expectation that the company’s EPSmg will shrink by 0.68% annually over the next 7-10 years.  Clearly this assumption is not supported by the historical achievements of the company, and the ModernGraham valuation model accordingly returns an intrinsic value estimate that exceeds the market price.  (See the full valuation)
F Chart

F data by YCharts

What do you think?  Are these companies a good value for Enterprising Investors?  Is there a company you like better?  Leave a comment on our Facebook page or mention @ModernGraham on Twitter to discuss.

Disclaimer:  The author held a long position in Coach Inc. (COH) and Ford Motor Company (F) but did not hold a position in any other company mentioned in this article at the time of publication and had no intention of changing those holdings within the next 72 hours.

18 Companies in the Spotlight This Week – 5/17/14

image (7)We looked at 18 different companies this week.  Here’s a summary of the ModernGraham Valuations.  For more detailed analysis, click on the name of the company.  Yesterday we also screened all 290 companies in the database to find the 5 Highest Dividend Yields Among Undervalued Defensive Companies.  We also introduced a new valuation index, where you can view all companies reviewed by ModernGraham.  To see more screens of the valuations, be sure to sign up to be a premium subscriber of ModernGraham Stocks and Screens!

The Elite (Defensive or Enterprising and Undervalued)

  • 200px-Eastman_Chemical_Company_logo.svgEastman Chemical Co. (EMN) – Eastman Chemical Co. is suitable for both Defensive Investors and Enterprising Investors.  The Defensive Investor’s only concern is with the high PB ratio, while the Enterprising Investor’s concern lies with the high level of debt relative to the net current assets.  As a result, value investors following the ModernGraham approach based on Benjamin Graham’s methods should feel very comfortable proceeding with further research into the company and comparing it to other opportunities such as E I Du Pont de Nemours and Co. (DD) and Dow Chemical Corp. (DOW).  As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $2.06 in 2010 to an estimated $5.64 for 2014.  This strong level of demonstrated growth surpasses the market’s implied estimate of 3.36% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that is well above the market price.

 

  • PeoplesUnitedBankPeople’s United Financial (PBCT) – People’s United Financial is suitable for Enterprising Investors but not for Defensive Investors.  The Defensive Investor is concerned with the high PEmg ratio, but the company passes all of the requirements for the Enterprising Investor.  As a result, Enterprising Investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company and comparing the company to other opportunities.  As for a valuation, the company appears undervalued after growing its EPSmg (normalized earnings) from a $0.34 in 2010 to an estimated $0.71 for 2014.  This level of demonstrated growth surpasses the market’s implied estimate of 5.81% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that is well above the price at this time.

 

  • UnitedHealth_Group_logo (1)UnitedHealth Group (UNH) – UnitedHealth Group is suitable for both Defensive Investors and Enterprising Investors.  The company passes all of the Defensive Investor’s requirements except the current ratio, and even though the Enterprising Investor is concerned with the high level of debt relative to current assets, the company qualifies for both investor types because it is suitable for Defensive Investors.  As a result, value investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company and its competitors.  From a valuation side of things, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $3.36 in 2010 to an estimated $5.24 in 2014.  This level of demonstrated growth exceeds the market’s implied estimate of 3.11% earnings growth and leads the ModernGraham to calculate an estimate of intrinsic value that is well above the price.

 

  • 200px-Yahoo!_logo.svgYahoo Inc. (YHOO) – Yahoo Inc. is suitable for Enterprising Investors but not Defensive Investors.  The Defensive Investor is concerned with the lack of dividend payments as well as the high PEmg and PB ratios.  The Enterprising Investor is also concerned with the lack of dividend payments, but the company passes all of the investor type’s other requirements.  As a result, Enterprising Investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company and its competitors, including a review of Microsoft Corp (MSFT) and Google Inc. (GOOG).  As for the valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $0.57 in 2010 to an estimated $1.54 for 2014.  This level of demonstrated growth is greater than the market’s implied estimate of 6.82% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that is well above the market price.

The Good (Defensive or Enterprising and Fairly Valued)

  • Ace Limited (ACE) – Ace Limited is suitable for either the Defensive Investor or the Enterprising Investor.  The company passes all of the requirements of both investor types, which is a rare accomplishment.  As a result, value investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company and comparing the company to other opportunities such as through a review of Aflac Inc. (AFL)Chubb Corporation (CB) and Unum Group (UNM).  From a valuation side of things, the company appears fairly valued after growing its EPSmg (normalized earnings) from $7.24 in 2010 to an estimated $8.60 for 2014.  This level of demonstrated growth supports the market’s implied estimate of 1.72% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that falls within a margin of safety relative to the market price.

 

  • ConAgra Foods Inc. (CAG) – ConAgra Foods is suitable for both Defensive Investors and Enterprising Investors.  The company passes all of the Defensive Investor’s requirements except the current ratio, and even though the Enterprising Investor is concerned with the high level of debt relative to current assets, the company qualifies for both investor types because it is suitable for Defensive Investors.  As a result, value investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company and its competitors.  From a valuation side of things, the company appears to be fairly valued after growing its EPSmg (normalized earnings) from $1.40 in 2010 to an estimated $1.82 in 2014.  This level of demonstrated growth, while rather low, is supportive of the market’s implied estimate of 4.4% earnings growth and leads the ModernGraham to calculate an estimate of intrinsic value that falls within a margin of safety relative to the price.

 

  • Fidelity National Information Services (FIS) – Fidelity National is suitable for Enterprising Investors but not for Defensive Investors.  The Defensive Investor is concerned with the low current ratio, lack of sufficient earnings growth over the last ten years, and the high PEmg ratio.  The Enterprising Investor’s only concern is the high level of debt relative to the net current assets.  As a result, Enterprising Investors following the ModernGraham approach based on Benjamin Graham’s methods should feel very comfortable proceeding with further research into the company and comparing it to other opportunities such as Visa Inc. (V) and Discover Financial Services (DFS).  From a valuation side of things, the company appears to be fairly valued after growing its EPSmg (normalized earnings) from $1.10 in 2010 to an estimated $1.89 for 2014.  This level of demonstrated growth supports the market’s implied estimate of 9.98% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that falls within a margin of safety relative to the price.

 

  • Hess Corporation (HESS) – Hess Corp is suitable for both Defensive Investors and Enterprising Investors.  The Defensive Investor’s only concern is the low current ratio, and while the Enterprising Investor is concerned about the level of debt relative to current assets, since the company qualifies for Defensive Investors, it by default also qualifies for Enterprising Investors.  As a result, value investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company and its competitors, including a review of Chevron Corporaion (CVX) and Exxon Mobil (XOM).  From a valuation side of things, the company appears fairly valued after growing its EPSmg (normalized earnings) from $5.38 in 2010 to an estimated $6.59 for 2014.  This demonstrated level of growth supports the market’s implied estimate of 2.39% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that falls within a safety margin relative to the price.

 

  • Travelers Companies (TRV) – Travelers Companies is suitable for either the Defensive Investor or the Enterprising Investor.  The company passes all of the requirements of both investor types, which is a rare accomplishment.  As a result, value investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company and comparing the company to other opportunities.  From a valuation side of things, the company appears fairly valued after growing its EPSmg (normalized earnings) from $6.19 in 2010 to an estimated $7.49 for 2014.  This level of demonstrated growth supports the market’s implied estimate of 1.95% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that falls within a margin of safety relative to the market price.

 

  • Varian Medical Systems (VAR) – Varian Medical Systems Inc. is suitable for the Enterprising Investor but not the Defensive Investor.  Defensive Investors are concerned with the lack of dividend payments and the high PEmg and PB ratios.  Enterprising Investors also find the lack of dividend payments concerning.  As a result, Enterprising Investors following the ModernGraham approach based on Benjamin Graham’s methods should feel very comfortable proceeding with further research into the company and comparing it to other opportunities such as General Electric (GE).  From a valuation side of things, the company appears to be fairly valued after growing its EPSmg (normalized earnings) from $2.52 in 2010 to an estimated $3.87 for 2014.  This demonstrated level of growth supports the market’s implied 6.33% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that is within a margin of safety relative to the price.

 

  • Visa Inc. (V) – Visa is suitable for Enterprising Investors but not yet for Defensive Investors.  The Defensive Investor has a number of requirements that need ten years of existence as a publicly traded company, and while Visa has been around for a very long time, it has not been publicly traded for all that long.  However, Enterprising Investors have a shorter time horizon, and the company passes all of the requirements for that investor type.  As a result, Enterprising Investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company and its competitors.  From a valuation standpoint, the company appears to be fairly valued after growing its EPSmg (normalized earnings) from $2.00 in 2010 to an estimated $6.44 for 2014.  This level of demonstrated growth is in line with the market’s implied estimate of 11.84% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that falls within a margin of safety relative to the price.

The Mediocre (Defensive or Enterprising and Overvalued)

  • Netflix Inc. (NFLX) – Netflix is suitable for Enterprising Investors but not for Defensive Investors.  The Defensive Investor has significant concerns regarding the low current ratio, the lack of dividend payments, and the exceptionally high PEmg and PB ratios.  The Enterprising Investor is willing to accept more risk, though, and is only concerned with the lack of dividend payments.  As a result, Enterprising Investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company and its competitors.  From a valuation side of things, the company appears to be very significantly overvalued after growing its EPSmg (normalized earnings) from $1.96 in 2010 to only an estimated $2.22 for 2014.  This low level of demonstrated growth is in stark contrast to the market’s implied estimate of 73.36% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that is way below the market price.

 

  • Nike Inc. (NKE) – Nike Inc. qualifies for the Enterprising Investor but not the Defensive Investor.  The company passes all of the requirements of the Enterprising Investor, but the PEmg and PB ratios are too high for Defensive Investors.  As a result, Enterprising Investors following the ModernGraham approach based on Benjamin Graham’s methods should feel very comfortable proceeding with further research into the company and comparing it to other opportunities.  From a valuation perspective, the company appears overvalued after growing its EPSmg (normalized earnings) from $1.70 in 2010 to an estimated $2.58 for 2014.  This is level of demonstrated growth does not support the market’s implied estimate of 9.97% earnings growth, leading the ModernGraham valuation model to return an estimate of intrinsic value that falls below the price.

The Bad (Speculative and Undervalued or Fairly Valued)

  • Iron Mountain Inc. (IRM) – Iron Mountain Inc. is not suitable for either the Defensive Investor or the Enterprising Investor.  In fact, the only requirement of the Defensive Investor which the company passes is the market cap size.  Likewise, the Enterprising Investor has significant concerns with the lack of earnings stability over the last five years and the high level of debt relative to current assets.  As a result, value investors following the ModernGraham approach based on Benjamin Graham’s methods should explore other opportunities.  From a valuation perspective, the company appears fairly valued after growing its EPSmg (normalized earnings) from $0.42 in 2010 to an estimated $0.85 for 2014.  This demonstrated level of growth supports the market’s implied estimate of 11.65% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that falls within a margin of safety relative to the price.

 

  • McKesson Corp (MCK) – McKesson Corp is not suitable for either the Defensive Investor or the Enterprising Investor.  The Defensive Investor has concerns with the low current ratio, lack of earnings stability over the last ten years, and the high PEmg and PB ratios, while the Enterprising Investor is concerned with the high level of debt relative to the current assets.  As a result, value investors following the ModernGraham approach based on Benjamin Graham’s methods should explore other opportunities through a review of Cardinal Health (CAH) and 5 Undervalued Companies for the Defensive Investor.  From a valuation side of things, the company appears fairly valued after growing its EPSmg (normalized earnings) from $3.57 in 2010 to $6.27 for 2014.  This level of demonstrated growth supports the market’s implied estimate of 9.96% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that falls within a margin of safety relative to the price.

The Ugly (Speculative and Overvalued)

Mr. Market

  • Gamestop Corp (GME) – Gamestop Corp is not suitable for either the Defensive Investor or the Enterprising Investor.  The Defensive Investor has concerns with the low current ratio, lack of sufficient earnings stability or growth over the last ten years, and the high PEmg ratio.  Meanwhile, the Enterprising Investor has concerns with the low current ratio, and the lack of sufficient earnings stability or growth over the five year period.  As a result, value investors following the ModernGraham approach based on Benjamin Graham’s methods should explore other opportunities such as Apple Inc. (AAPL).  From a valuation side of things, the company appears to be significantly overvalued after seeings its EPSmg (normalized earnings) drop from $1.92 in 2010 to $1.41 for 2014.  This demonstrated drop in earnings leads the ModernGraham valuation model to return an estimate of intrinsic value well below the market price.

 

  • Intercontinental Exchange Group (ICE) – Intercontinental Exchange Group is not suitable for either the Defensive Investor or the Enterprising Investor.  The Defensive Investor has concerns with the low current ratio, the short dividend record, and the high PEmg ratio.  The Enterprising Investor has significant concerns with the high level of debt relative to current assets.  As a result, value investors following the ModernGraham approach based on Benjamin Graham’s methods should explore other opportunities.  From a valuation perspective, the company appears overvalued after growing its EPSmg (normalized earnings) from $4.37 in 2010 to an estimated $6.77 for 2014.  This demonstrated level of growth does not support the market’s implied estimate of 9.84% earnings growth and leads the ModernGraham valuation model to return an estimate of intrinsic value that falls below the price.

 

  • Kinder Morgan Inc. (KMI) – Kinder Morgan does not have a long enough operating history as a publicly traded company to qualify for either the Defensive Investor or the Enterprising Investor; however, it is still useful for value investors to take a brief look at the company and keep it on the radar for the future.  In the meantime, value investors following the ModernGraham approach based on Benjamin Graham’s methods should explore other opportunities.  From a valuation side of things, the lack of earnings data for more than 4 years prohibits the ModernGraham valuation model from determining an estimate of intrinsic value; however, the market is currently implying an estimate of 12.26% earnings growth.  If one does not believe the company will achieve that growth rate, the price would appear to be overvalued.

Disclaimer:  The author did not hold a position in any of the other companies listed in this article at the time of publication and had no intention of changing that position within the next 72 hours.

Logos taken from either the company website or Wikipedia; this article is not affiliated with the companies in any manner.

February 2014 in Review

image (8)Site News

February was another great month for ModernGraham.  We had nearly 28,000 visits by almost 15,000 unique visitors, while the number of people who have signed up for the email list grew from 1,656 to 2,402!  We released the fourth issue of the monthly publication, ModernGraham Stocks & Screens, which lists all of the valuations and screens them for various criteria.  This month’s edition included 184 companies, and two mock portfolios, the Defensive Undervalued Portfolio and the Enterprising Undervalued Portfolio.  February also saw the beginning of the ModernGraham Book Club, and a number of value investors began reading and discussing The Intelligent Investor by Benjamin Graham (affiliate link).  In related news, I launched BenjaminClarkLaw.com, the website for my legal practice in Illinois focusing on Estate Planning and Taxation.

Most Popular Content from February out of 74 posts:

  1. 5 Undervalued Companies for the Enterprising Investor
  2. 5 Outstanding Dow Components
  3. 15 Companies in the Spotlight This Week – 2/1/14
  4. 5 Low PEmg Companies for the Defensive Investor
  5. January 2014 in Review

Companies Reviewed in February

Baker Hughes Incorporated (BHI)
Baxter International Inc. (BAX)
BB&T Corporation (BBT)
Bemis Company, Inc. (BMS)
Chevron Corporation (CVX)
Cisco Systems, Inc. (CSCO)
ConAgra Foods, Inc. (CAG)
Delta Air Lines, Inc. (DAL)
Dover Corp (DOV)
E I Du Pont De Nemours And Co (DD)
Ecolab Inc. (ECL)
Facebook Inc (FB)
Fastenal Company (FAST)
Ford Motor Company (F)
Gannett Co., Inc. (GCI)
General Growth Properties Inc (GGP)
Genuine Parts Company (GPC)
Harman International Industries Inc./DE/ (HAR)
Hasbro, Inc. (HAS)
Intel Corporation (INTC)
Intercontinentalexchange Group Inc (ICE)
International Flavors & Fragrances Inc (IFF)
Jabil Circuit, Inc. (JBL)
Johnson & Johnson (JNJ)
Johnson Controls Inc (JCI)
JPMorgan Chase & Co. (JPM)
Kellogg Company (K)
KeyCorp (KEY)
L Brands Inc (LB)
Loews Corporation (L)
Macerich Co (MAC)
Macy’s, Inc. (M)
Microsoft Corporation (MSFT)
Molson Coors Brewing Company (TAP)
Nabors Industries Ltd. (NBR)
Nike Inc (NKE)
Noble Energy, Inc. (NBL)
ONEOK, Inc. (OKE)
Owens-Illinois Inc (OI)
People’s United Financial, Inc. (PBCT)
Pitney Bowes Inc. (PBI)
QEP Resources Inc (QEP)
Reynolds American, Inc. (RAI)
Ryder System, Inc. (R)
SCANA Corporation (SCG)
Starbucks Corporation (SBUX)
The Boeing Company (BA)
The Gap Inc. (GPS)
The Procter & Gamble Company (PG)
United States Steel Corporation (X)
UnitedHealth Group Inc. (UNH)
Unum Group (UNM)
Varian Medical Systems, Inc. (VAR)
Visa Inc (V)
Walgreen Company (WAG)
Yahoo! Inc. (YHOO)
Zions Bancorporation (ZION)

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14 Companies in the Spotlight This Week – 2/15/14

We looked at 14 different companies this week.  Here’s a summary of the ModernGraham Valuations.  For more detailed analysis, click on the name of the company.  To see screens of all of our valuations, be sure to get a copy of this month’s edition of ModernGraham Stocks and Screens!

The Elite (Defensive or Enterprising and Undervalued)

  • 200px-Ace_Limited_logo.svgAce Limited (ACE) – Ace Limited is an extremely attractive company, despite its continued rise in price over the last number of years.  The company passes every requirement of both the Defensive Investor and the Enterprising Investor, demonstrating that it is financially sound.  Value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should feel very comfortable proceeding with further research to determine if the company is right for their individual portfolios.  Such research could include a review of ModernGraham’s valuation of AFLAC (AFL), or a review of ModernGraham’s valuation of The Chubb Corporation (CB).  From a valuation perspective, the company looks great, having grown its EPSmg (normalized earnings) from $5.30 in 2008 to $7.87 for 2013.  This level of growth outpaces the market’s current implied estimate for earnings growth of only 1.83%, and the ModernGraham valuation model returns an intrinsic value that is well above the market price.

 

  • Microsoft_logo_and_wordmark.svgMicrosoft Corp. (MSFT) – Microsoft Corporation fares slightly better today than it did during its last quarterly valuation (on November 12, 2013 it was given a fairly valued & defensive rating).  Today it is still considered suitable for the Defensive Investor, but the intrinsic value has improved slightly.  The company passes all of the requirements of the Defensive Investor, save for the PB ratio requirement.  It also passes all of the requirements of the Enterprising Investor.  As a result, value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should feel very comfortable proceeding with further research to determine whether the company fits their individual portfolios, beginning with a review of ModernGraham’s valuation of Apple (AAPL) and ModernGraham’s valuation of Google (GOOG).  From a valuation perspective, as noted the intrinsic value is slightly higher than it was previously, due to better than estimated earnings results.  The company has grown its EPSmg (normalized earnings) from $1.56 in 2009 to an estimated $2.46 for 2014.  This level of growth is very solid and outpaces the market’s current implied estimate for growth of 3.18%, leading the ModernGraham valuation model to return an intrinsic value that is greater than the market price.  It should be noted, though, that the value is just slightly outside of the margin of safety, so the company barely earns an undervalued rating.

 

  • Unum-logoUnum Group (UNM) – Unum Group is a rather attractive company for the Enterprising Investor, and will likely soon qualify for the Defensive Investor as well.  Currently, the company does not qualify for the Defensive Investor because it had a negative earnings year in 2004, so it has not met the requirement of 10 straight years of positive earnings.  Next year it will more than likely satisfy that requirement, but for now Defensive Investors should merely keep the company on the watch list.  Enterprising Investors wishing to follow the ModernGraham approach based on Benjamin Graham’s methods should feel good proceeding with further research including a review of ModernGraham’s valuation of AFLAC Inc. (AFL) and other companies that pass the ModernGraham requirements.  From a valuation side of things, the company has done well, having grown its EPSmg (normalized earnings) from $1.33 in 2008 to $2.64 for 2013.  This solid level of growth outpaces the market’s implied estimate for growth of only 1.99%, leading the ModernGraham valuation model to return an intrinsic value greater than the market price.  As a result, the company appears to be undervalued at the present time.

 

  • 200px-Yahoo!_logo.svgYahoo Inc. (YHOO) – Yahoo! Inc. is a very attractive company for Enterprising Investors, as it passed all of the investor type’s requirements except the dividend payments.  The Defensive Investor is not as interested, due to the lack of dividend payments and the high PEmg and PB ratios.  Value investors seeking to follow the Enterprising Investor portion of the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research.  An example of further research may include a review of ModernGraham’s valuation of Microsoft and ModernGraham’s valuation of Google.  From a valuation perspective, Yahoo has grown its EPSmg (normalized earnings) from $0.54 in 2008 to $1.62 for 2013.  This is a very strong level of growth that outpaces the market’s implied estimate for growth of 7.38%.  The ModernGraham valuation model consequently estimates an intrinsic value that is well above the market’s current price, and the company would appear to be undervalued.

The Good (Defensive or Enterprising and Fairly Valued)

  • Molson Coors Brewing Co. (TAP) – Molson Coors is an intriguing company to both Defensive Investors and Enterprising Investors, and should be kept on their watch lists.  For the Defensive Investor, the company only fails the current ratio requirement, and because the company is suitable for the Defensive Investor, it is also suitable for the Enterprising Investor.  Value investors interested in following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research, including a comparison of Molson Coors to other companies that pass the ModernGraham requirements.  From a valuation side of things, the company has grown its EPSmg (normalized earnings) from $2.27 in 2008 to an estimated $3.43 for 2013.  This level of growth solidly supports the market’s implied estimate of 3.38% growth and the company would appear to be fairly valued by the ModernGraham valuation model at this time.

 

  • Travelers Companies (TRV) – Travelers fares very well in the ModernGraham approach, having passed all of the requirements of both the Defensive Investor and the Enterprising Investor.  The intrinsic value has improved from $85.91 in our last valuation of the company to $96.30, largely due to earnings figures that were better than I anticipated (side note: this is a great benefit of basing valuations on the low estimates – it is better to have guessed low than guess high).  As a result, value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should feel very comfortable proceeding with further research.  Research should include a review of some other companies, such as through a review of ModernGraham’s valuation of Ace Limited (ACE), or ModernGraham’s valuation of AFLAC (AFL).  From a valuation perspective, the company has improved its EPSmg (normalized earnings) from $5.11 in 2008 to $6.84 for 2013.  This is a solid level of growth that supports the market’s current implied growth estimate of 1.81%.  As a result, the company appears to be fairly valued at the present time.

 

  • Varian Medical Systems Inc. (VAR) – Varian Medical Systems is suitable for the Enterprising Investor, having passed all requirements except the dividend payment requirement.  The company is not suitable for the Defensive Investor, due to the lack of dividend payments as well as high PEmg and PB ratios.  Enterprising Investors should feel comfortable moving forward with further research into the company, including a review of ModernGraham’s valuation of General Electric, and other companies that pass the ModernGraham requirements.  From a valuation perspective, the company appears fairly valued after growing its EPSmg (normalized earnings) from $2.21 in 2009 to an estimated $3.89.  This level of growth is supportive of the market’s implied estimate of 6.08%, leading the ModernGraham valuation model to return an intrinsic value estimate within a margin of safety in comparison to the market price.

The Mediocre (Defensive or Enterprising and Overvalued)

  • Nike Inc. (NKE) – Nike has exhibited some great growth, and has many qualities that make it very attractive; however, the company is not suitable for the Defensive Investor because it is trading at too high PEmg and PB ratios.  Enterprising Investors are not as concerned about those ratios, though, and the company passes all of the requirements for that investor type.  As a result, Enterprising Investors following a ModernGraham approach should feel comfortable proceeding with further research into the company, including a review of other companies that pass the ModernGraham requirements.  As for a valuation, Nike has grown its EPSmg (normalized earnings) from $1.55 in 2009 to an estimated $2.58 for 2014.  This solid level of growth is impressive, but it lags behind the market’s implied growth estimate of 9.86%, leading the ModernGraham valuation model to return an intrinsic value estimate that is below the market’s price.  Therefore, it would appear that Nike is currently overvalued.

 

The Bad (Speculative and Undervalued or Fairly Valued)

  • Starbucks Corp. (SBUX) – Starbucks is a very reputable company, but it does not qualify for either the Defensive Investor or the Enterprising Investor.  For the Defensive Investor, the company’s current ratio is too low, it does not have a long enough dividend history, and it currently trades at high PEmg and PB ratios.  For the Enterprising Investor, the company’s debt is too high relative to its current assets.  As a result, value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should research other opportunities such as through a review of companies that pass the ModernGraham requirements.  From a valuation perspective, the company has seen solid growth, having grown its EPSmg (normalized earnings) from $0.60 in 2009 to an estimated $2.11 for 2014.  This level of growth is in line with the market’s current implied estimate of 13.30% growth, and the ModernGraham valuation model returns an intrinsic value within the margin of safety.  Therefore, the company appears to be fairly valued at the present time.

The Ugly (Speculative and Overvalued)

Mr. Market

  • BB&T Corporation (BBT) – BB&T Corporation does not qualify for either the Defensive Investor or the Enterprising Investor.  The company has not demonstrated sufficient growth over either the 5 year or 10 year period.  Value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods may find better opportunities elsewhere through research, such as by reviewing ModernGraham’s valuation of Wells Fargo & Co. (WFC).  From a valuation perspective, the company has seen its EPSmg (normalized earnings) go from $2.89 in 2008 to $2.28 for 2014.  This lack of growth certainly does not support the market’s implied growth estimate of 4%.  As a result, the ModernGraham valuation model returns an intrinsic value that is above the market price, and the company appears to be overvalued at this time.

 

  • Proctor & Gamble (PG) – Proctor & Gamble is not suitable for either the Defensive Investor or the Enterprising Investor.  For the Defensive Investor, the company’s current ratio is too low and it is trading at PEmg and PB ratios that are too high.  For the Enterprising Investor, there is too much debt relative to the company’s current assets.  As a result, value investors may wish to research other opportunities, such as by reviewing ModernGraham’s valuation of Colgate-Palmolive and ModernGraham’s valuation of Johnson and Johnson.  From strictly a valuation standpoint, the company has grown its EPSmg (normalized earnings) from $3.30 in 2009 to an estimated $3.82 for 2014.  While this growth supports the company’s continued raising of the dividend, it does not support the market’s current implied earnings growth estimate of 5.97% and as a result the ModernGraham valuation model returns an intrinsic value that is below the market’s current price.

 

  • U.S. Steel Corporation (X) – U.S. Steel is not suitable for either the Defensive Investor or the Enterprising Investor.  The company has had a number of negative earnings years recently, which is extremely off-putting for Intelligent Investors.  For the Defensive Investor, the lack of earnings stability or growth along with the low current ratio eliminate the company from consideration.  For the Enterprising Investor, it is the level of debt relative to current assets in addition to the lack of earnings stability and growth.  As a result, value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should seek out other opportunities by reviewing a list of 5 Outstanding Dow Components.  From a valuation perspective, the company fares very poorly in the ModernGraham model due to the shrinking EPSmg (normalized earnings) and the negative EPSmg in the current year.  As a result, the company appears to be overvalued at the current time.

 

  • Walgreen Company (WAG) – Walgreen Company does not pass enough of the requirements of either the Defensive Investor or the Enterprising Investor in order to be suitable for investment by Intelligent Investors.  Specifically, the company fails the Defensive Investor’s current ratio, PEmg ratio, and PB ratio requirements.  The company fails the Enterprising Investor’s requirements by having too much debt relative to its current assets.  As a result, value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should research other opportunities, such as through a review of ModernGraham’s valuation of CVS Caremark Corporation or ModernGraham’s Glance at the Dow.  From a valuation perspective, the company has grown its EPSmg (normalized earnings) from $1.99 in 2009 to an estimated $2.82 for 2014.  This level of growth is solid, but does not support the market’s current implied estimate for earnings growth of 7.15%, leading the ModernGraham valuation model to estimate that the intrinsic value is below the market price at this time.

 

  • Zions Bancorporation (ZION) – Zions Bancorporation does not pass the requirements of either the Defensive Investor or the Enterprising Investor.  The company presents too much risk for the Defensive Investor, after failing to have sufficient earnings stability or growth over the ten year historical period and currently trading at a high PEmg ratio.  The company also presents slightly more risk than the Enterprising Investor is willing to accept, as it has not had the requisite earnings stability in the five year historical period.  As a result, value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should seek out other opportunities, such as through a review of ModernGraham’s valuation of People’s United Financial (PBCT) or other companies that pass the ModernGraham requirements.  The company also fares rather poorly in the ModernGraham valuation model, as a result of the very weak EPSmg (normalized earnings) for 2013.  The company has improved its EPSmg substantially, from -$2.08 in 2009 to $0.02 for 2013, but until that figure is considerably higher, the valuation will continue to be poor.

Disclaimer:  The author held a long position in Apple Inc. (AAPL) but did not hold a position in any of the other companies listed in this article at the time of publication and had no intention of changing that position within the next 72 hours.

Logos taken from either the company website or Wikipedia; this article is not affiliated with the companies in any manner.

Zions Bancorporation (ZION) Annual Valuation

500px-Zions_Bancorporation_Logo.svg

In the wake of the great financial crisis it can sometimes be difficult for Intelligent Investors to find a solid bank in which to invest, because they require specific achievements over the historical period.  Many investors may simply decide to throw out the worst years with the rationale that they are outliers that shouldn’t be considered when evaluating the company’s prospects, but doing so would involve speculation.  We don’t know whether the financial crisis will happen again, but we do know that if it does, we can expect to see similar results as we did before.  By continuing to require the same standards for the historical period, Intelligent Investors are able to widdle down banks to only those with the best financial position, and then they are able to determine an intrinsic value to get a sense of whether the company is a good investment.  In addition, a company must have strong financial statements to prove that it is stable enough for Intelligent Investors.  This is best done by utilizing a systematic approach to analysis that will provide investors with a sense of how a specific company compares to another company.  By using the ModernGraham method one can review a company’s historical accomplishments and determine an intrinsic value that can be compared across industries.  What follows is a specific look at how Zions Bancorporation fares in the ModernGraham valuation model.

Company Profile (obtained from Google Finance): Zions Bancorporation is a financial holding company. The Company focuses on providing community banking services by its core business lines of small and medium-sized business and corporate banking; commercial and residential development, construction and term lending; retail banking; treasury cash management and related products and services; residential mortgage; trust and wealth management, and investment activities. The Company owns and operates eight commercial banks with a total of 480 domestic branches in 10 western and southwestern states as of December 31, 2012. The Company provides a range of banking and related services through its banking and other subsidiaries, primarily in Utah, California, Texas, Arizona, Nevada, Colorado, Idaho, Washington, and Oregon. As of December 31, 2012, net loans and leases accounted for 67.9% of total assets.

ZION Chart

ZION data by YCharts

Defensive Investor – must pass all 6 of the following tests: Score = 3/6

  1. Adequate Size of Enterprise – market capitalization of at least $2 billion – PASS
  2. Earnings Stability – positive earnings per share for at least 10 straight years – FAIL
  3. Dividend Record – has paid a dividend for at least 10 straight years – PASS
  4. Earnings Growth – earnings per share has increased by at least 1/3 over the last 10 years using 3 year averages at beginning and end of period – FAIL
  5. Moderate PEmg ratio – PEmg is less than 20 – FAIL
  6. Moderate Price to Assets – PB ratio is less than 2.5 or PB x PEmg is less than 50 – PASS

Enterprising Investor – must pass all 3 of the following tests or be suitable for a defensive investor: Score = 2/3

  1. Earnings Stability – positive earnings per share for at least 5 years – FAIL
  2. Dividend Record – currently pays a dividend – PASS
  3. Earnings growth – EPSmg greater than 5 years ago – PASS

Valuation Summary

Key Data:

Recent Price $30.10
MG Value $0.95
MG Opinion Overvalued
Value Based on 3% Growth $0.36
Value Based on 0% Growth $0.21
Market Implied Growth Rate 605.89%
PEmg 1,220.27
PB Ratio 0.88

Balance Sheet – 9/30/2013

Total Debt $2,304,300,000
Total Assets $55,188,300,000
Intangible Assets $1,014,100,000
Total Liabilities $48,855,500,000
Outstanding Shares 184,600,000

Earnings Per Share

2013 $1.77
2012 $0.97
2011 $0.84
2010 -$2.48
2009 -$9.92
2008 -$2.67
2007 $4.42
2006 $5.36
2005 $5.16
2004 $4.47
2003 $3.74

Earnings Per Share – ModernGraham 

2013 $0.02
2012 -$1.45
2011 -$2.43
2010 -$3.06
2009 -$2.08
2008 $2.35

Dividend History

ZION Dividend Chart

ZION Dividend data by YCharts

Conclusion:

Zions Bancorporation does not pass the requirements of either the Defensive Investor or the Enterprising Investor.  The company presents too much risk for the Defensive Investor, after failing to have sufficient earnings stability or growth over the ten year historical period and currently trading at a high PEmg ratio.  The company also presents slightly more risk than the Enterprising Investor is willing to accept, as it has not had the requisite earnings stability in the five year historical period.  As a result, value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should seek out other opportunities, such as through a review of ModernGraham’s valuation of People’s United Financial (PBCT) or other companies that pass the ModernGraham requirements.  The company also fares rather poorly in the ModernGraham valuation model, as a result of the very weak EPSmg (normalized earnings) for 2013.  The company has improved its EPSmg substantially, from -$2.08 in 2009 to $0.02 for 2013, but until that figure is considerably higher, the valuation will continue to be poor.

The next part of the analysis is up to individual investors, and requires discussion of the company’s prospects.  What do you think?  What value would you put on Zions Bancorporation (ZION)?  Where do you see the company going in the future?  Is there a company you like better?  Leave a comment on our Facebook page or mention @ModernGraham on Twitter to discuss.

If you like our valuations, why not check out ModernGraham Stocks & Screens?  It’s a great way to review the valuations while screening for things like low PE ratio, undervalued companies, etc.!

Disclaimer:  The author did not hold a position in Zions Bancorporation (ZION) or any of the other companies listed in this article at the time of publication and had no intention of changing that position within the next 72 hours.

Logo taken from the Wikipedia; this article is not affiliated with the company in any manner.

15 Companies in the Spotlight This Week – 2/8/14

We looked at 15 different companies this week.  Here’s a summary of the ModernGraham Valuations.  For more detailed analysis, click on the name of the company.  To see screens of all of our valuations, be sure to get a copy of this month’s edition of ModernGraham Stocks and Screens, which was just released this week!

The Elite (Defensive or Enterprising and Undervalued)

  • 500px-Cisco_logo.svgCisco Systems Inc. (CSCO) – Cisco Systems, Inc. looks very good for both the Defensive Investor and the Enterprising Investor, and has even improved upon the state we found the company when it was last reviewed in November 2013.  The company passes all of the requirements of the Defensive Investor except for the dividend history, as the company only recently began paying a dividend.  In addition, all five of the requirements of the Enterprising Investor are satisfied.  As a result, value investors following the ModernGraham approach should feel comfortable proceeding with further research to determine whether Cisco is right for their individual portfolio.  One recommended research technique would be to compare Cisco to competitors such as by reviewing the ModernGraham valuation of Microsoft (MSFT) and the ModernGraham valuation of Hewlett-Packard Co. (HPQ).  From a valuation perspective, the company has grown EPSmg (normalized earnings) from $1.11 in 2009 to an estimated $1.63 for 2013.  This level of growth is very solid, and outpaces the market’s implied growth rate of 2.46%.  The ModernGraham valuation model returns an intrinsic value that surpasses the market’s price, demonstrating that the company seems to be undervalued at the present time.

 

  • 500px-Gannett_logo_2011.svgGannett Co. Inc. (GCI) – Gannett is an intriguing company for Enterprising Investors, after having passed every requirement of the investor type except the debt to current assets requirement.  The company does not qualify for Defensive Investors, however, because of the current ratio being too low, and the lack of earnings stability or sufficient growth over the ten year period.  As a result, Enterprising Investors should feel very comfortable proceeding with further research to determine if Gannett is suitable for their individual portfolios, keeping in mind the 7 Key Tips to Value Investing.  From purely a valuation standpoint, the company appears undervalued, after growing EPSmg (normalized earnings) from -$6.63 in 2008 to an estimated $1.93 for 2013.  This level of growth significantly outpaces the market’s current implied estimate of growth (2.87%), and the ModernGraham valuation model indicates a value around $74.

The Good (Defensive or Enterprising and Fairly Valued)

  • Harman International Industries (HAR) – Harman International Industries performs fairly well in the ModernGraham system.  The company is not suitable for Defensive Investors, after failing every requirement other than the market cap, but is suitable for Enterprising Investors, who are capable of undertaking substantial research and accepting slightly more risk.  The company passes all five of the requirements of the Enterprising Investor, and these value investors seeking to follow Benjamin Graham’s methods should feel comfortable proceeding with further research, such as a review of ModernGraham’s valuation of Apple (AAPL).  From a valuation perspective, the ModernGraham valuation model returns an intrinsic value that indicates the market price is within the margin of safety.  The company’s EPSmg (normalized earnings) have grown from -$0.53 in 2010 to an estimated $3.11 for 2013.  This strong level of growth is in line with the market’s implied estimate of 12.39%.  Therefore, the company is fairly valued.

 

  • Intercontinental Exchange Group Inc. (ICE) – Intercontinental Exchange Group has demonstrated an excellent level of earnings growth, and its financial statements indicate a company that is suitable for Enterprising Investors.  The company does not qualify for Defensive Investors because of a low current ratio, lack of a dividend payment history, and high PEmg and PB ratios.  Enterprising Investors are not quite as picky, though, and the company only fails the Enterprising Investor’s current ratio requirement.  As a result, value investors falling into the Enterprising Investor category and seeking to follow Benjamin Graham’s methods should feel comfortable proceeding with further research into the company to determine whether it is suitable for their individual portfolio.  One source of additional research may be to review other companies that pass the ModernGraham requirements.  From a valuation perspective, the company has grown its EPSmg (normalized earnings) from $2.90 in 2008 to an estimated $7.03 for 2013.  This is a very solid level of growth that falls in line with what the market is currently implying as an estimate.  Accordingly, the ModernGraham valuation model returns an intrinsic value that is within the margin of safety as the market price and the company appears to be fairly valued.

 

  • Loews Corporation (L) – Loews Corporation is an intriguing company for Enterprising Investors and should be added to their watch lists.  The company is not suitable for the Defensive Investor, having achieved insufficient earnings growth and stability over the ten year historical period.  Enterprising Investors look over a shorter time horizon, though, and should be very pleased with Loews Corporation’s financials.  Those who determine themselves to be Enterprising Investors after considering the definitions of each investor type should feel comfortable proceeding with further research to determine if the company is right for their individual portfolios.  From a valuation perspective, the company has grown its EPSmg (normalized earnings) from $1.68 in 2009 to an estimated $2.39 for 2013.  While this is not a huge level of growth, it does support the market’s implied growth rate of 4.85%, and the ModernGraham valuation model considers the company to be fairly valued.

 

  • People’s United Financial (PBCT) – People’s United Financial is an excellent company for Enterprising Investors to keep on their watch list.  Defensive Investors are not as interested, due to the high PEmg ratio and the lack of earnings stability over the ten year historical period.  Enterprising Investors should feel very comfortable with the company, and should go ahead with further research into whether it would be suitable for their individual portfolios.  This research could include a review of other banks such as by reviewing ModernGraham’s valuation of JP Morgan (JPM) and ModernGraham’s valuation of Wells Fargo (WFC).  From a valuation standpoint, People’s United has grown its EPSmg (normalized earnings) from $0.40 in 2009 to $0.61 for 2013.  This level of growth supports the market’s implied growth estimate of 7.15%, and the ModernGraham valuation model returns an intrinsic value that is within our safety margin of the market’s current price, so the company would appear to be fairly valued.  It should also be noted that this company has a strong dividend yield, which may be attractive to Enterprising Investors.

The Mediocre (Defensive or Enterprising and Overvalued)

  • E I Du Pont De Nemours and Co. (DD) – Du Pont is a solid company for Enterprising Investors to have on their watch list, but not Defensive Investors.  For Defensive Investors, the company’s current ratio is just a little too low, the company has not sufficiently grown its earnings over the ten year period, and the company is trading at high PEmg and PB ratios.  Enterprising Investors, on the other hand, could not be happier as the company has passed all of the requirements of this investor type.  As a result, value investors seeking to follow the Enterprising Investor portion of the ModernGraham approach based on Benjamin Graham’s methods should feel very comfortable proceeding with further research, including a review of ModernGraham’s analysis of Dow Chemical (DOW).  From a valuation side of things, Du Pont has grown its EPSmg (normalized earnings) from $2.46 in 2009 to $3.01 for 2013.  This level of growth does not quite support the market’s current implied growth estimate of 6.02%, and accordingly the ModernGraham valuation model returns an intrinsic value that is less than the market’s current price.  Therefore, the company appears to be overvalued at the present time.

 

  • Fastenal Co. (FAST) – Fastenal is a great company that should be on the radar of all Enterprising Investors.  The company may not be suitable for Defensive Investor at the current time because it is trading at high PEmg and PB ratios, but the company passes all of the requirements of the Enterprising Investor.  As a result, these investors seeking to follow Benjamin Graham’s teachings should keep Fastenal on their watch lists as they compare the company to other investment opportunities, such as by reviewing some other companies that pass the ModernGraham requirements.  Looking at the company through the ModernGraham valuation model, the company has grown its EPSmg (normalized earnings) from $0.75 in 2008 to a $1.29 for 2013.  This is a solid level of growth, but it lags behind the market’s implied growth rate of 12.84%.  As a result, the intrinsic value appears to be lower than the market’s current price, and the company appears to be overvalued.

 

  • Kellogg Co. (K) – Kellogg company has a very good history of raising its dividend, but alone isn’t enough to qualify the company for either the Defensive Investor or the Enterprising Investor.  The company doesn’t qualify for the Defensive Investor because of the low current ratio and the high PB ratio.  For the Enterprising Investor, the disqualifying factor is the high level of debt relative to the current assets.  While debt can be good for a company and there are plenty of companies that are very solid and financially strong with low current ratios, the ModernGraham approach requires a specific level of current ratio because it is a useful metric for eliminating some companies from the investment horizon.  Value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods, should seek other opportunities by reviewing a list of companies that pass the ModernGraham requirements.  From a valuation perspective, Kellogg looks slightly overvalued.  The company’s EPSmg (normalized earnings) have grown from $2.69 in 2008 to an estimated $3.30 for 2013, a strong level of growth that trails the market’s current implied estimate for growth.  The ModernGraham valuation model returns an intrinsic value estimate of $41.80 based on the historically demonstrated growth, which is below the current market price.

The Bad (Speculative and Undervalued or Fairly Valued)

  • Jabil Circuit Inc. (JBL) – Jabil Circuit has seen a strong level of growth since they posted a significant loss in 2009; however, the company is not suitable for either the Defensive Investor or the Enterprising Investor.  For the Defensive Investor, the problem is the low current ratio, the lack of earnings stability, and the lack of earnings growth over the ten year period.  For the Enterprising Investor, the only problem is the level of debt relative to current assets.  As a result, value investors seeking to follow the ModernGraham interpretation of Benjamin Graham’s methods should seek other opportunities, through a review of companies that pass the ModernGraham requirements.  From strictly a valuation perspective, Jabil looks pretty good.  The company’s EPSmg (normalized earnings) have grown from -$1.46 in 2009 to an estimated $1.41 for 2014.  This demonstrated growth surpasses what the market is estimating, and indicates the company may be undervalued.

 

  • Macy’s, Inc. (M) – Macy’s, Inc. does not qualify for either the Defensive Investor or the Enterprising Investor.  The company’s current ratio is too low, it hasn’t had earnings stability over the ten year period, and the PB ratio is too high for the Defensive Investor.  For the Enterprising Investor, the debt level relative to the current assets is too high.  As a result, value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should seek other opportunities by reviewing companies that pass the ModernGraham requirements.  From strictly a valuation perspective, the company has significantly grown EPSmg from -$2.35 in 2009 to an estimated $3.05 for 2014.  This solid level of growth outpaces the market’s current implied estimate for earnings growth of 4.09%, and the ModernGraham valuation model returns an intrinsic value that is well above the market price; but investors should be very cautious as the company presents a little more risk than is acceptable to Intelligent Investors.

The Ugly (Speculative and Overvalued)

Mr. Market

  • Noble Energy Inc. (NBL) – Noble Energy, Inc. does not meet the standards of the Defensive Investor or the Enterprising Investor.  The company has not had earnings stability or growth over the ten year horizon, has a very poor current ratio, and trades at a high PEmg ratio.  All of these factors combined eliminate the company from contention for the Defensive Investor.  For the Enterprising Investor, the company holds too much debt relative to its current assets, and has not had stable earnings over the five year time period.  As a result, value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should seek other opportunities by reviewing companies that pass the ModernGraham requirements.  The results of the ModernGraham valuation model are also poor, as the company’s intrinsic value appears to be considerably less than the market price.  The company’s EPSmg (normalized earnings) have only grown from $1.83 in 2009 to an estimated $2.18 for 2013.  This level of growth does not even come close to supporting the market’s current implied estimate of over 10% growth for the company.  Accordingly, the company does not appear to be a good value opportunity at this time.

 

  • Owens-Illinois Inc. (OI) – Owens-Illinois Inc. fares very poorly in the ModernGraham analysis, having passed only one requirement of the Defensive Investor and only one requirement of the Enterprising Investor.  As such, the company presents a risk level that is too great for value investors following the ModernGraham approach based on Benjamin Graham’s methods, and they should seek other opportunities by reviewing companies that pass the ModernGraham requirements.  From the valuation side of things, the company has failed to achieve much growth in its EPSmg (normalized earnings), having gone from $0.40 in 2008 to $0.85 for 2013.  The market is currently implying a growth estimate of over 14%, which is clearly not supported by the historical growth rate.  Even if the company were to achieve a modest level of growth, 3% annually, the intrinsic value based on the current EPSmg would remain considerably less than the market’s price level.  As a result, the company appears to be overvalued at the present time.

 

  • QEP Resources (QEP) – QEP Resources does not qualify for either the Defensive Investor or the Enterprising Investor because it does not have a long enough history as an individual company.  Without at least five years of operating history on its own, investors are left to speculate about how the company would have performed prior to its spin-off.  As a result, investors should take note of the company and analyze it as much as possible, but keep it on a watch list until there is further information.  In the meantime, value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should research other opportunities, such as through a review of companies that pass the ModernGraham requirements.  From a valuation perspective, even though there is not enough information to generate a solid estimate for growth, speculators will note that based on the current EPSmg (normalized earnings), and a growth rate of 3%, the company would only be worth $17.58 under the ModernGraham valuation model.

 

  • Ryder System Inc. (R) – Ryder System, Inc. is not suitable for either Defensive Investors or Enterprising Investors.  The company’s current ratio is far too low for Defensive Investors, and it has not sufficiently grown its earnings over the ten year period.  For Enterprising Investors, the company holds too much debt relative to its current assets.  As a result, value investors seeking to follow the ModernGraham approach based on Benjamin Graham’s methods should research other opportunities, such as through a review of companies that pass the ModernGraham requirements.  From strictly a valuation side of things, the company’s EPSmg (normalized earnings) have grown from $3.10 in 2009 to $3.76 for 2013.  This level of demonstrated historical growth lags behind the market’s implied estimate for growth of 5.11%.  As a result, the ModernGraham valuation model returns an intrinsic value that is below the price at which the market currently trades, and the company appears to be overvalued.

Disclaimer:  The author did not hold a position in any of the companies listed in this article at the time of publication and had no intention of changing that position within the next 72 hours.

Logos taken from either the company website or Wikipedia; this article is not affiliated with the companies in any manner.

Valuation Index

Updated as of July 20, 2017:

Here is a list of all companies currently covered by ModernGraham, as of the date listed above.  Clicking on the company name will bring you to the latest valuation of the company published by ModernGraham.

Ticker Name with Link
A Agilent Technologies Inc
AA Alcoa Corp
AAL American Airlines Group Inc
AAN Aaron’s, Inc.
AAP Advance Auto Parts, Inc.
AAPL Apple Inc.
AAXN Axon Enterprise Inc
ABBV AbbVie Inc
ABC AmerisourceBergen Corp.
ABT Abbott Laboratories
ACC American Campus Communities, Inc.
ACIW ACI Worldwide Inc
ACM Aecom
ACN Accenture Plc
ACXM Acxiom Corporation
ADBE Adobe Systems Incorporated
ADI Analog Devices, Inc.
ADM Archer Daniels Midland Company
ADP Automatic Data Processing
ADS Alliance Data Systems Corporation
ADSK Autodesk, Inc.
AEE Ameren Corp
AEO American Eagle Outfitters
AEP American Electric Power Company Inc
AES AES Corp
AET Aetna Inc
AFG American Financial Group Inc
AFL AFLAC Incorporated
AGCO AGCO Corporation
AGN Allergan plc Ordinary Shares
AHL Aspen Insurance Holdings Limited
AIG American International Group Inc
AIV Apartment Investment and Management Co
AIZ Assurant, Inc.
AJG Arthur J Gallagher & Co
AKAM Akamai Technologies, Inc.
AKRX Akorn, Inc.
ALB Albemarle Corporation
ALEX Alexander & Baldwin Inc
ALGN Align Technology, Inc.
ALK Alaska Air Group, Inc.
ALL Allstate Corp
ALLE Allegion PLC
ALXN Alexion Pharmaceuticals, Inc.
AMAT Applied Materials, Inc.
AMCX AMC Networks Inc
AMD Advanced Micro Devices, Inc.
AME AMETEK, Inc.
AMG Affiliated Managers Group, Inc.
AMGN Amgen, Inc.
AMP Ameriprise Financial, Inc.
AMT American Tower Corp
AMZN Amazon.com, Inc.
AN AutoNation, Inc.
ANF Abercrombie & Fitch Co.
ANSS ANSYS, Inc.
ANTM Anthem Inc
AON Aon plc Class A Ordinary Shares (UK)
AOS A. O. Smith Corp
APA Apache Corporation
APC Anadarko Petroleum Corporation
APD Air Products & Chemicals, Inc.
APH Amphenol Corporation
APOL Apollo Education Group Inc
ARE Alexandria Real Estate Equities Inc
ARLP Alliance Resource Partners, L.P.
ARRS ARRIS International plc
ARW Arrow Electronics, Inc.
ASH Ashland Global Holdings Inc.
ATI Allegheny Technologies Incorporated
AVB AvalonBay Communities Inc
AVGO Broadcom Ltd
AVP Avon Products, Inc.
AVY Avery Dennison Corp
AWK American Water Works Company Inc
AXP American Express Company
AYI Acuity Brands, Inc.
AZO AutoZone, Inc.
BA Boeing Co
BAC Bank of America Corp
BAX Baxter International Inc
BBBY Bed Bath & Beyond Inc.
BBT BB&T Corporation
BBY Best Buy Co Inc
BCR C R Bard Inc
BDX Becton Dickinson and Co
BEN Franklin Resources, Inc.
BF.B Brown-Forman Corporation
BGS B&G Foods, Inc.
BHI Baker Hughes A GE Co
BIIB Biogen Inc
BK Bank of New York Mellon Corp
BLK BlackRock, Inc.
BLL Ball Corporation
BMS Bemis Company, Inc.
BMY Bristol-Myers Squibb Co
BRK.B Berkshire Hathaway Inc.
BSX Boston Scientific Corporation
BWA BorgWarner Inc.
BXP Boston Properties, Inc.
C Citigroup Inc
CA CA, Inc.
CAG Conagra Brands Inc
CAH Cardinal Health Inc
CAM Cameron International Corporation
CAT Caterpillar Inc.
CB Chubb Ltd
CBG CBRE Group Inc
CBS CBS Corporation
CCE Coca-Cola European Partners plc Ordinary Shares
CCI Crown Castle International Corp. (REIT)
CCL Carnival Corp
CELG Celgene Corporation
CENX Century Aluminum Co
CERN Cerner Corporation
CEVA CEVA, Inc.
CF CF Industries Holdings, Inc.
CFG Citizens Financial Group Inc
CFNL Cardinal Financial Corporation
CFR Cullen/Frost Bankers, Inc.
CGI Celadon Group, Inc.
CGNX Cognex Corporation
CHCO City Holding Company
CHD Church & Dwight Co., Inc.
CHE Chemed Corporation
CHK Chesapeake Energy Corporation
CHRW C.H. Robinson Worldwide Inc
CHS Chico’s FAS, Inc.
CHSP Chesapeake Lodging Trust
CHTR Charter Communications, Inc.
CHUY Chuy’s Holdings Inc
CI CIGNA Corporation
CIEN Ciena Corporation
CIG Companhia Energetica de Minas Gers CEMIG
CINF Cincinnati Financial Corporation
CIR CIRCOR International, Inc.
CKH Seacor Holdings, Inc.
CL Colgate-Palmolive Company
CLD Cloud Peak Energy Inc.
CLF Cliffs Natural Resources Inc
CLGX Corelogic Inc
CLH Clean Harbors Inc
CLI Mack Cali Realty Corp
CLMS Calamos Asset Management, Inc
CLW Clearwater Paper Corp
CLX Clorox Co
CMA Comerica Incorporated
CMC Commercial Metals Company
CMCSA Comcast Corporation
CME CME Group Inc
CMG Chipotle Mexican Grill, Inc.
CMI Cummins Inc.
CMO Capstead Mortgage Corporation
CMP Compass Minerals International, Inc.
CMS CMS Energy Corporation
CMTL Comtech Telecomm. Corp.
CNC Centene Corp
CNK Cinemark Holdings, Inc.
CNMD CONMED Corporation
CNO CNO Financial Group Inc
CNP CenterPoint Energy, Inc.
CNSL Consolidated Communications Holdings Inc
CNX CONSOL Energy Inc.
COF Capital One Financial Corp.
COG Cabot Oil & Gas Corporation
COH Coach Inc
COHR Coherent, Inc.
COHU Cohu, Inc.
COL Rockwell Collins, Inc.
COLB Columbia Banking System Inc
COO Cooper Companies Inc
COP ConocoPhillips
COR CoreSite Realty Corp
CORE Core-Mark Holding Company, Inc.
COST Costco Wholesale Corporation
COTY Coty Inc
CPB Campbell Soup Company
CPF Central Pacific Financial Corp.
CPLA Capella Education Company
CPRT Copart, Inc.
CPS Cooper-Standard Holdings Inc
CPSI Computer Programs & Systems, Inc.
CPT Camden Property Trust
CRAY Cray Inc.
CRC California Resources Corp
CREE Cree, Inc.
CRI Carter’s, Inc.
CRL Charles River Laboratories Intl. Inc
CRM salesforce.com, inc.
CROX Crocs, Inc.
CRR CARBO Ceramics Inc.
CRS Carpenter Technology Corporation
CRVL CorVel Corporation
CRY Cryolife Inc
CRZO Carrizo Oil & Gas Inc
CSCO Cisco Systems, Inc.
CSGS CSG Systems International, Inc.
CSL Carlisle Companies, Inc.
CSRA CSRA Inc
CST CST Brands Inc
CSX CSX Corporation
CTAS Cintas Corporation
CTL Centurylink Inc
CTRE Caretrust REIT Inc
CTS CTS Corporation
CTSH Cognizant Technology Solutions Corp
CTXS Citrix Systems, Inc.
CUB Cubic Corporation
CUBI Customers Bancorp Inc
CUZ Cousins Properties Inc
CVBF CVB Financial Corp.
CVCO Cavco Industries, Inc.
CVG Convergys Corp
CVGW Calavo Growers, Inc.
CVLT CommVault Systems, Inc.
CVS CVS Health Corp
CVX Chevron Corporation
CWT California Water Service Group
CXO Concho Resources Inc
CXW Corecivic Inc
CY Cypress Semiconductor Corporation
CYH Community Health Systems
D Dominion Energy Inc
DAKT Daktronics, Inc.
DAL Delta Air Lines, Inc.
DAN Dana Inc
DAR Darling Ingredients Inc
DBD Diebold Nixdorf Inc
DCI Donaldson Company, Inc.
DCOM Dime Community Bancshares, Inc.
DD E I Du Pont De Nemours And Co
DDD 3D Systems Corporation
DE Deere & Company
DEI Douglas Emmett, Inc.
DFS Discover Financial Services
DG Dollar General Corp.
DGX Quest Diagnostics Inc
DHI D.R. Horton, Inc.
DHR Danaher Corporation
DIS Walt Disney Co
DISCA Discovery Communications Inc.
DISCK Discovery Communications Inc.
DLPH Delphi Automotive PLC
DLR Digital Realty Trust, Inc.
DLTR Dollar Tree, Inc.
DNB Dun & Bradstreet Corp
DNR Denbury Resources Inc.
DO Diamond Offshore Drilling Inc
DOV Dover Corp
DOW Dow Chemical Co
DPS Dr Pepper Snapple Group Inc.
DRI Darden Restaurants, Inc.
DTE DTE Energy Co
DUK Duke Energy Corp
DVA Davita Inc
DVN Devon Energy Corp
EA Electronic Arts Inc.
EBAY eBay Inc
ECL Ecolab Inc.
ED Consolidated Edison, Inc.
EFX Equifax Inc.
EIX Edison International
EL Estee Lauder Companies Inc
EMN Eastman Chemical Company
EMR Emerson Electric Co.
ENDP Endo International plc – Ordinary Shares
EOG EOG Resources Inc
EPD Enterprise Products Partners L.P.
EQIX Equinix, Inc.
EQR Equity Residential
EQT EQT Corporation
ES Eversource Energy
ESRX Express Scripts Holding Company
ESS Essex Property Trust Inc
ESV ENSCO PLC
ETFC E*TRADE Financial Corp
ETN Eaton Corporation, PLC Ordinary Shares
ETR Entergy Corporation
EVHC Envision Healthcare Corporation
EW Edwards Lifesciences Corp
EXC Exelon Corporation
EXPD Expeditors International of Washington
EXPE Expedia Inc
EXR Extra Space Storage, Inc.
F Ford Motor Company
FAST Fastenal Company
FB Facebook Inc
FBHS Fortune Brands Home & Security Inc
FCX Freeport-McMoRan Inc
FDX FedEx Corporation
FE FirstEnergy Corp.
FFIV F5 Networks, Inc.
FIS Fidelity National Information Servcs Inc
FISV Fiserv Inc
FITB Fifth Third Bancorp
FL Foot Locker, Inc.
FLIR FLIR Systems, Inc.
FLR Fluor Corporation (NEW)
FLS Flowserve Corp
FMC FMC Corp
FOSL Fossil Group Inc
FOXA Twenty-First Century Fox Inc
FRT Federal Realty Investment Trust
FSLR First Solar, Inc.
FTI TechnipFMC plc Ordinary Share
FTR Frontier Communications Corp
FTV Fortive Corp
GAS AGL Resources Inc.
GD General Dynamics Corporation
GE General Electric Company
GG Goldcorp Inc. (USA)
GGP GGP Inc
GHC Graham Holdings Co
GILD Gilead Sciences, Inc.
GIS General Mills, Inc.
GLW Corning Incorporated
GM General Motors Company
GME GameStop Corp.
GNW Genworth Financial Inc
GOOG Alphabet Inc
GOOGL Alphabet Inc
GPC Genuine Parts Company
GPN Global Payments Inc
GPS Gap Inc
GRMN Garmin Ltd.
GS Goldman Sachs Group Inc
GT Goodyear Tire & Rubber Co
GWW W W Grainger Inc
HAL Halliburton Company
HAR Harman International Industries Inc
HAS Hasbro, Inc.
HBAN Huntington Bancshares Incorporated
HBI Hanesbrands Inc.
HCA HCA Healthcare Inc
HCN Welltower Inc
HCP HCP, Inc.
HD Home Depot Inc
HES Hess Corp.
HIG Hartford Financial Services Group Inc
HOG Harley-Davidson Inc
HOLX Hologic, Inc.
HON Honeywell International Inc.
HP Helmerich & Payne, Inc.
HPE Hewlett Packard Enterprise Co
HPQ HP Inc
HRB H & R Block Inc
HRL Hormel Foods Corp
HRS Harris Corporation
HSIC Henry Schein, Inc.
HST Host Hotels and Resorts Inc
HSY Hershey Co
HUM Humana Inc
IBM International Business Machines Corp.
ICE Intercontinental Exchange Inc
IDXX IDEXX Laboratories, Inc.
IFF International Flavors & Fragrances Inc
IIVI II-VI, Inc.
ILG ILG Inc
ILMN Illumina, Inc.
IM Ingram Micro Inc.
IMO Imperial Oil Ltd (USA)
INDB Independent Bank Corp
INFY Infosys Ltd ADR
INGN Inogen Inc
INGR Ingredion Inc
INN Summit Hotel Properties Inc
INT World Fuel Services Corp
INTC Intel Corporation
INTL INTL Fcstone Inc
INTU Intuit Inc.
IOSP Innospec Inc.
IP International Paper Co
IPAR Inter Parfums, Inc.
IPCC Infinity Property and Casualty Corp.
IPG Interpublic Group of Companies Inc
IPGP IPG Photonics Corporation
IPHS Innophos Holdings, Inc.
IPI Intrepid Potash, Inc.
IPXL Impax Laboratories Inc
IR Ingersoll-Rand PLC
IRBT iRobot Corporation
IRDM Iridium Communications Inc
IRM Iron Mountain Incorporated (Delaware) REIT
ISCA International Speedway Corp
ISRG Intuitive Surgical, Inc.
ITG Investment Technology Group
ITRI Itron, Inc.
ITT ITT Inc.
ITW Illinois Tool Works Inc.
IVC Invacare Corporation
IVZ Invesco Ltd.
JACK Jack in the Box Inc.
JBHT J B Hunt Transport Services Inc
JBL Jabil Inc
JBLU JetBlue Airways Corporation
JBT John Bean Technologies Corp
JCI Johnson Controls International plc Ordinary Share
JCP J C Penney Company Inc
JEC Jacobs Engineering Group Inc
JJSF J & J Snack Foods Corp
JKHY Jack Henry & Associates, Inc.
JLL Jones Lang LaSalle Inc
JNJ Johnson & Johnson
JNPR Juniper Networks, Inc.
JOY Joy Global Inc.
JPM JPMorgan Chase & Co.
JW.A John Wiley & Sons Inc
JWN Nordstrom, Inc.
K Kellogg Company
KALU Kaiser Aluminum Corp.
KAMN Kaman Corporation
KATE Kate Spade & Co
KBH KB Home
KBR KBR, Inc.
KELYA Kelly Services, Inc.
KEX Kirby Corporation
KEY KeyCorp
KEYS Keysight Technologies Inc
KFY Korn/Ferry International
KHC Kraft Heinz Co
KIM Kimco Realty Corp
KIRK Kirkland’s, Inc.
KKR KKR & Co. L.P.
KLAC KLA-Tencor Corp
KLIC Kulicke and Soffa Industries Inc.
KLXI KLX Inc
KMB Kimberly Clark Corp
KMI Kinder Morgan Inc
KMPR Kemper Corp
KMT Kennametal Inc.
KMX CarMax, Inc
KN Knowles Corp
KND Kindred Healthcare, Inc.
KNX Knight Transportation
KO The Coca-Cola Co
KOP Koppers Holdings Inc.
KOPN Kopin Corporation
KORS Michael Kors Holdings Ltd
KR Kroger Co
KRA Kraton Corp
KRC Kilroy Realty Corp
KRG Kite Realty Group Trust
KS KapStone Paper and Packaging Corp.
KSS Kohl’s Corporation
KSU Kansas City Southern
KWR Quaker Chemical Corp
L Loews Corporation
LABL Multi-Color Corporation
LAD Lithia Motors Inc
LAMR Lamar Advertising Company
LANC Lancaster Colony Corp.
LB L Brands Inc
LCI Lannett Company, Inc.
LDL Lydall, Inc.
LDOS Leidos Holdings, Inc.
LDR Landauer Inc
LECO Lincoln Electric Holdings, Inc.
LEG Leggett & Platt, Inc.
LEN Lennar Corporation
LFUS Littelfuse, Inc.
LGIH LGI Homes Inc
LGND Ligand Pharmaceuticals Inc.
LH Laboratory Corp. of America Holdings
LHCG LHC Group, Inc.
LHO LaSalle Hotel Properties
LII Lennox International Inc.
LITE Lumentum Holdings Inc
LKQ LKQ Corporation
LL Lumber Liquidators Holdings Inc
LLL L3 Technologies Inc
LLTC Linear Technology Corporation
LLY Eli Lilly and Co
LM Legg Mason Inc
LMNX Luminex Corporation
LMOS Lumos Networks Corp
LMT Lockheed Martin Corporation
LNC Lincoln National Corporation
LNN Lindsay Corporation
LNT Alliant Energy Corporation
LOCO El Pollo LoCo Holdings Inc
LOGM LogMeIn Inc
LOW Lowe’s Companies, Inc.
LPNT LifePoint Health Inc
LPSN LivePerson, Inc.
LPT Liberty Property Trust
LPX Louisiana-Pacific Corporation
LQDT Liquidity Services, Inc.
LRCX Lam Research Corporation
LSTR Landstar System, Inc.
LTC LTC Properties Inc
LTXB LegacyTexas Financial Group Inc
LUK Leucadia National Corp.
LUV Southwest Airlines Co
LVLT Level 3 Communications, Inc.
LXP Lexington Realty Trust
LYB LyondellBasell Industries NV
LYV Live Nation Entertainment, Inc.
M Macy’s Inc
MA Mastercard Inc
MAA Mid-America Apartment Communities Inc
MAC Macerich Co
MAIN Main Street Capital Corporation
MAR Marriott International Inc
MAS Masco Corp
MAT Mattel, Inc.
MCD McDonald’s Corporation
MCHP Microchip Technology Inc.
MCK McKesson Corporation
MCO Moody’s Corporation
MDLZ Mondelez International Inc
MDT Medtronic plc. Ordinary Shares
MET Metlife Inc
MHK Mohawk Industries, Inc.
MKC McCormick & Company, Incorporated
MLM Martin Marietta Materials, Inc.
MMC Marsh & McLennan Companies, Inc.
MMM 3M Co
MMP Magellan Midstream Partners, L.P.
MNK Mallinckrodt PLC
MNST Monster Beverage Corporation
MO Altria Group Inc
MON Monsanto Company
MOS Mosaic Co
MPC Marathon Petroleum Corp
MRK Merck & Co., Inc.
MRO Marathon Oil Corporation
MS Morgan Stanley
MSFT Microsoft Corporation
MSI Motorola Solutions Inc
MTB M&T Bank Corporation
MTD Mettler-Toledo International Inc.
MTSC MTS Systems Corporation
MU Micron Technology, Inc.
MUR Murphy Oil Corporation
MYL Mylan N.V.
NAVI Navient Corp
NBL Noble Energy, Inc.
NBR Nabors Industries Ltd.
NDAQ Nasdaq Inc
NE Noble Corporation Ordinary Shares (UK)
NEE NextEra Energy Inc
NEM Newmont Mining Corp
NFLX Netflix, Inc.
NFX Newfield Exploration Co.
NI NiSource Inc.
NKE Nike Inc
NLSN Nielsen N.V. Ordinary Shares
NNN National Retail Properties, Inc.
NOC Northrop Grumman Corporation
NOV National-Oilwell Varco, Inc.
NPK National Presto Industries Inc.
NRP Natural Resource Partners LP
NSC Norfolk Southern Corp.
NTAP NetApp Inc.
NTRS Northern Trust Corporation
NUE Nucor Corporation
NVDA NVIDIA Corporation
NWL Newell Brands Inc
NWS News Corp
NWSA News Corp
O Realty Income Corp
OI Owens-Illinois Inc
OKE ONEOK, Inc.
OLN Olin Corporation
OMC Omnicom Group Inc.
ORCL Oracle Corporation
ORLY O’Reilly Automotive Inc
OXY Occidental Petroleum Corporation
PAYX Paychex, Inc.
PBCT People’s United Financial, Inc.
PBI Pitney Bowes Inc.
PCAR PACCAR Inc
PCG PG&E Corporation
PCLN Priceline Group Inc
PDCO Patterson Companies, Inc.
PEG Public Service Enterprise Group Inc.
PEP PepsiCo, Inc.
PFE Pfizer Inc.
PFG Principal Financial Group Inc
PG Procter & Gamble Co
PGR Progressive Corp
PH Parker-Hannifin Corp
PHM PulteGroup, Inc.
PKI PerkinElmer, Inc.
PLD Prologis Inc
PM Philip Morris International Inc.
PMD Psychemedics Corp.
PNC PNC Financial Services Group Inc
PNR Pentair plc. Ordinary Share
PNW Pinnacle West Capital Corporation
PPG PPG Industries, Inc.
PPL PPL Corp
PRGO Perrigo Company plc Ordinary Shares
PRU Prudential Financial Inc
PSA Public Storage
PSX Phillips 66
PVH PVH Corp
PWR Quanta Services Inc
PX Praxair, Inc.
PXD Pioneer Natural Resources
PYPL Paypal Holdings Inc
QCOM QUALCOMM, Inc.
QEP QEP Resources Inc
QRVO Qorvo Inc
R Ryder System, Inc.
RAI Reynolds American, Inc.
RAVN Raven Industries, Inc.
RBC Regal Beloit Corp
RDC Rowan Companies PLC
REGN Regeneron Pharmaceuticals Inc
RF Regions Financial Corp
RHI Robert Half International Inc.
RHT Red Hat Inc
RIG Transocean LTD
RL Ralph Lauren Corp
ROK Rockwell Automation
ROP Roper Technologies Inc
ROST Ross Stores, Inc.
RRC Range Resources Corp.
RSG Republic Services, Inc.
RTN Raytheon Company
SAIA Saia Inc
SAIC Science Applications International Corp
SAM Boston Beer Company Inc
SANM Sanmina Corp
SBNY Signature Bank
SBRA Sabra Health Care REIT Inc
SBSI Southside Bancshares, Inc.
SBUX Starbucks Corporation
SCAI Surgical Care Affiliates Inc
SCG SCANA Corporation
SCHL Scholastic Corp
SCHW Charles Schwab Corp
SCI Service Corporation International
SCLN SciClone Pharmaceuticals, Inc.
SCSC ScanSource, Inc.
SCSS Select Comfort Corp.
SCVL Shoe Carnival, Inc.
SE Spectra Energy Corp.
SEE Sealed Air Corp
SEIC SEI Investments Company
SEM Select Medical Holdings Corporation
SENEA Seneca Foods Corp
SF Stifel Financial Corp
SFBS ServisFirst Bancshares, Inc.
SFNC Simmons First National Corporation
SGMS Scientific Games Corp
SHLM A Schulman Inc
SHOO Steven Madden, Ltd.
SHW Sherwin-Williams Co
SIG Signet Jewelers Ltd.
SIGI Selective Insurance Group
SIVB SVB Financial Group
SJI South Jersey Industries Inc
SJM J M Smucker Co
SKT Tanger Factory Outlet Centers Inc.
SKYW SkyWest, Inc.
SLAB Silicon Laboratories
SLB Schlumberger Limited.
SLCA U.S. Silica Holdings Inc
SLG SL Green Realty Corp
SLGN Silgan Holdings Inc.
SLM SLM Corp
SLW SWISS LIFE HLDG SF 5,10
SM SM Energy Co
SMCI Super Micro Computer, Inc.
SMG Scotts Miracle-Gro Co
SMP Standard Motor Products, Inc.
SMRT Stein Mart, Inc.
SMTC Semtech Corporation
SNA Snap-on Incorporated
SNCR Synchronoss Technologies, Inc.
SNH Senior Housing Properties Trust
SNI Scripps Networks Interactive, Inc.
SNPS Synopsys, Inc.
SNV Synovus Financial Corp.
SO Southern Co
SON Sonoco Products Co
SONC Sonic Corporation
SPG Simon Property Group Inc
SPGI S&P Global Inc
SPH Suburban Propane Partners LP
SPLS Staples, Inc.
SPN Superior Energy Services, Inc.
SPOK Spok Holdings, Inc.
SPPI Spectrum Pharmaceuticals, Inc.
SPSC SPS Commerce, Inc.
SPTN SpartanNash Co
SPXC SPX Corp
SR Spire Inc
SRCL Stericycle Inc
SRDX SurModics, Inc.
SRE Sempra Energy
SSD Simpson Manufacturing Co, Inc.
SSI Stage Stores Inc
SSP E. W. Scripps Co
SSTK Shutterstock Inc
STBA S & T Bancorp Inc
STC Stewart Information Services Corp
STE Steris PLC
STI SunTrust Banks, Inc.
STL Sterling Bancorp
STLD Steel Dynamics, Inc.
STMP Stamps.com Inc.
STRA Strayer Education Inc
STT State Street Corp
STWD Starwood Property Trust, Inc.
STX Seagate Technology PLC
STZ Constellation Brands, Inc.
SUP Superior Industries International Inc
SUPN Supernus Pharmaceuticals Inc
SVU SUPERVALU INC.
SWK Stanley Black & Decker, Inc.
SWKS Skyworks Solutions Inc
SWM Schweitzer-Mauduit International, Inc.
SWN Southwestern Energy Company
SXC SunCoke Energy Inc
SXI Standex Int’l Corp.
SXT Sensient Technologies Corporation
SYF Synchrony Financial
SYK Stryker Corporation
SYKE Sykes Enterprises, Incorporated
SYMC Symantec Corporation
SYY SYSCO Corporation
T AT&T Inc.
TAP Molson Coors Brewing Co
TBI Trueblue Inc
TCBI Texas Capital Bancshares Inc
TCF TCF Financial Corporation
TCO Taubman Centers, Inc.
TDC Teradata Corporation
TDG TransDigm Group Incorporated
TDS Telephone & Data Systems, Inc.
TDW Tidewater Inc.
TDY Teledyne Technologies Incorporated
TECD Tech Data Corp
TECH BIO-TECHNE Corp
TEL TE Connectivity Ltd
TER Teradyne, Inc.
TESO Tesco Corporation (USA)
TEX Terex Corporation
TFX Teleflex Incorporated
TGNA Tegna Inc
TGT Target Corporation
THC Tenet Healthcare Corp
TIF Tiffany & Co.
TJX TJX Companies Inc
TMK Torchmark Corporation
TMO Thermo Fisher Scientific Inc.
TRIP Tripadvisor Inc
TROW T. Rowe Price Group Inc
TRV Travelers Companies Inc
TSCO Tractor Supply Company
TSE:ARE Aecon Group Inc
TSE:CEU CES Energy Solutions Corp
TSE:CFP Canfor Corporation
TSE:CG Centerra Gold Inc.
TSE:CGX Cineplex Inc
TSE:CHE.UN Chemtrade Logistics Income Fund
TSE:CIX CI Financial Corp
TSE:CJR.B Corus Entertainment Inc.
TSE:CLS Celestica Inc
TSE:CM Canadian Imperial Bank of Commerce
TSE:CNQ Canadian Natural Resources Limited
TSE:CNR Canadian National Railway Company
TSE:CP Canadian Pacific Railway Limited
TSE:CPG Crescent Point Energy Corp
TSE:CPX Capital Power Corp
TSE:CR Crew Energy Inc
TSE:CRR.UN Crombie Real Estate Investment Trust
TSE:CSH.UN Chartwell Retirement Residences
TSE:CSU Constellation Software Inc.
TSE:CTC.A Canadian Tire Corporation Limited
TSE:CU Canadian Utilities Limited
TSE:CUF.UN Cominar REIT
TSE:CVE Cenovus Energy Inc
TSE:CWB Canadian Western Bank
TSE:DDC Dominion Diamond Corp
TSE:D.UN Dream Office Real Estate Investment Trst
TSE:IGM IGM Financial Inc.
TSE:IMG IAMGOLD Corp
TSE:INE Innergex Renewable Energy Inc
TSE:IPL Inter Pipeline Ltd
TSE:ITP Intertape Polymer Group
TSE:IVN Ivanhoe Mines Ltd
TSE:JE Just Energy Group Inc
TSE:KDX Klondex Mines Ltd
TSE:KEL Kelt Exploration Ltd
TSE:KL KIRKLAND LAKE GOLD LTD
TSE:KXS Kinaxis Inc
TSE:LIF LABRADOR IRON ORE ROYALTY CORPORATION
TSE:LNR Linamar Corporation
TSE:LUC Lucara Diamond Corp
TSE:LUN Lundin Mining Corporation
TSE:SAP Saputo Inc.
TSE:SCL Shawcor Ltd
TSE:SES Secure Energy Services Inc
TSE:SGY Surge Energy Inc
TSE:SJ Stella-Jones Inc
TSE:SJR.B Shaw Communications Inc
TSE:SLF Sun Life Financial Inc
TSE:SMF Semafo Inc.
TSE:SNC Snc-Lavalin Group Inc
TSE:SPB Superior Plus Corp.
TSE:SPE Spartan Energy Corp
TSE:SRU.UN Smart REIT
TSE:SSL Sandstorm Gold Ltd
TSE:SSO Silver Standard Resources Inc.
TSE:STN Stantec Inc.
TSE:SU Suncor Energy Inc.
TSE:SW Sierra Wireless, Inc.
TSE:TA TransAlta Corporation
TSE:TCL.A Transcontinental Inc.
TSE:TCN Tricon Capital Group Inc
TSE:TD Toronto-Dominion Bank
TSE:TECK.B Teck Resources Ltd
TSE:tFII TFI International Inc
TSN Tyson Foods, Inc.
TSO Tesoro Corporation
TSS Total System Services, Inc.
TWX Time Warner Inc
TXN Texas Instruments Incorporated
TXT Textron Inc.
UA Under Armour Inc
UAA Under Armour Inc
UDR UDR, Inc.
UHS Universal Health Services, Inc.
ULTA Ulta Beauty Inc
UNH UnitedHealth Group Inc
UNIT Uniti Group Inc
UNM Unum Group
UNP Union Pacific Corporation
UPS United Parcel Service, Inc.
URBN Urban Outfitters, Inc.
URI United Rentals, Inc.
USB U.S. Bancorp
UTX United Technologies Corporation
V Visa Inc
VAR Varian Medical Systems, Inc.
VFC VF Corp
VIAB Viacom, Inc.
VLO Valero Energy Corporation
VMC Vulcan Materials Company
VNO Vornado Realty Trust
VRSK Verisk Analytics, Inc.
VRSN Verisign, Inc.
VRTX Vertex Pharmaceuticals Incorporated
VTR Ventas, Inc.
VZ Verizon Communications Inc.
WAT Waters Corporation
WBA Walgreens Boots Alliance Inc
WDC Western Digital Corp
WEC WEC Energy Group Inc
WFC Wells Fargo & Co
WFM Whole Foods Market, Inc.
WHR Whirlpool Corporation
WIN Windstream Holdings, Inc.
WM Waste Management, Inc.
WMB Williams Companies Inc
WMT Wal-Mart Stores Inc
WNR Western Refining, Inc.
WPX WPX Energy Inc
WR Westar Energy Inc
WRK WestRock Co
WU The Western Union Company
WWW Wolverine World Wide, Inc.
WY Weyerhaeuser Co
WYN Wyndham Worldwide Corporation
WYNN Wynn Resorts, Limited
X United States Steel Corporation
XEL Xcel Energy Inc
XL XL Group Ltd.
XLNX Xilinx, Inc.
XOM Exxon Mobil Corporation
XRAY DENTSPLY SIRONA Inc
XRX Xerox Corp
XYL Xylem Inc
YUM Yum! Brands, Inc.
ZBH Zimmer Biomet Holdings Inc
ZION Zions Bancorp
ZTS Zoetis Inc
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