MagicDiligence (61.69)

Magic Formula Investing Weekly Roundup 1/29/2012

January 29, 2012 – Comments (2) | RELATED TICKERS: AAPL , DISH , ORCL

Magic Formula Investing (MFI), as described by hedge fund manager Joel Greenblatt in The Little Book that Beats the Market, consists of ranking stocks by earnings yield (cheap) and return on capital (quality), adding the rankings together, and buying from the resulting lists. Below are stocks that have moved into, and dropped out of, 3 of the MFI screens used by MagicDiligence:  [more]

BMC Software Should Get Back to $50

January 26, 2012 – Comments (0) | RELATED TICKERS: BMC , ORCL , HPQ

MagicDiligence posted an article last week comparing 4 enterprise software companies currently listed in Magic Formula® Investing (MFI) - Oracle (ORCL), BMC Software (BMC), CA (CA), and Microsoft (MSFT). The conclusion was that Oracle was the best looking stock in the bunch, but that all were attractive.

This remains the case for BMC Software. Let's take a closer look at this interesting stock.  [more]

Magic Formula Investing Weekly Roundup 1/22/2012

January 22, 2012 – Comments (0) | RELATED TICKERS: FCX , ORCL , BBY

Magic Formula Investing (MFI), as described by hedge fund manager Joel Greenblatt in The Little Book that Beats the Market, consists of ranking stocks by earnings yield (cheap) and return on capital (quality), adding the rankings together, and buying from the resulting lists. Below are stocks that have moved into, and dropped out of, 3 of the MFI screens used by MagicDiligence:  [more]

Face Off: Enterprise Software Companies

January 17, 2012 – Comments (1) | RELATED TICKERS: MSFT , ORCL , BMC

One fact about Joel Greenblatt's Magic Formula® Investing (MFI) strategy is that it has a tendency to identify downtrodden industry sectors by screening several competitors at the same time. Such a situation exists today with a number of large enterprise software companies.

This is interesting to MagicDiligence, as enterprise software is a great business. Software is high margin, with operating margins routinely near 30%, and generates effuse free cash flows as capital investment requirements are small. Higher enterprise software sales do not require new factories or distribution networks. These companies also get 50% or more of their sales through recurring support and maintenance contracts that are renewed at over 90% rates, setting up a stable and reliable source of revenue.  [more]

Top 10 Dividend Yields, Lowest 10 P/B and P/S Stocks in Magic Formula

January 05, 2012 – Comments (0) | RELATED TICKERS: GME , ICON , HRB

Every so often, MagicDiligence compiles a list of Magic Formula® Investing (MFI) stocks sorted by their dividend yield, price-to-sales ratio, and price-to-book ratio for investors that like to use those metrics. The result produces a list of attractive value stocks for additional research. Here are the top 10 in each of the three metrics listed above:

Dividend Yield  [more]