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AllTooFoolish (75.11)

Feb 14, 2014 Benchmark Investing (BI) Selections



February 10, 2014 – Comments (0) | RELATED TICKERS: C , RF , AIG

There are many stocks to discuss this week and I am closing one position. Although long period between traded can seem boring at times, the low turnover clearly provides an advantage of both stability and low trading costs. Here is a snapshot of this week’s activities.

This week’s candidates:

C (Citigroup)– they continue to make slow strides forward on both the topline and bottomline. The stock price continues to trade at a discount to its BI valuation and will likely have a long uptrend for many years. I see no reason to trim my position at this time. Decision: Hold

RF (Regions Financial)– While RF continues to make internal adjustments, earnings were only a fraction better in 2013 than 2012. As the stock price sits at a multi-year high, there seems little room for improvement at this stage. As its price has exceeded the BI low estimate and its price appreciation potential is subpar, I am selling this stock and taking my profits. Decision: Sell

AIG (American International Group)– similar to Citigroup AIG’s stock has come a long way since the recession and its business is stabilizing. Using the BI pricing method this stock remains trading at a deep discount and looks to have huge upside potential in the long run. Helping this effort is the newly reinstated dividend. I am holding this stock for the time being. Decision: Hold

HIG (Hartford Financial Services)– HIG finished on a high note for the year with improvements on both the topline and bottomline financials. This stock should continue to do well for a long time as it continues to buy back shares and increase in dividends. Decision: Hold

YHOO (Yahoo!)– there’s been a real mixed bag of results for Yahoo!. On one hand they have significantly increased EPS, topline growth has been declining. For the time I will continue to hold this stock while keeping a close eye on it moving forward.Decision: Hold


The Process:

Every week a refresh of key financial data, stock prices, and economic data are evaluated. This information is analyzed using Kenneth Lee's selection process as described in “Trouncing the Dow". Individual stocks are selected based on their relative valuation compared to their own historical valuation metrics. The scientific based approach allow for a superior “rules-based” decision making to buy and sell stocks that has been proven to yield superior results over time.

Each week a broad set of stocks are considered to be bought, sold, or held as part of the process.

Tickers discussed here: C, RF, AIG, HIG, YHOO

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