Recap from March’s Picks
Our Most Attractive Stocks (-4.5%) outperformed the S&P 500 (-5.3%) as a long portfolio last month. Most Attractive Large Cap stock Humana Inc. (HUM) gained 3%. Most Attractive Small Cap stock Fonar Corporation (FONR) was up 14%. Overall, 22 out of the 40 Most Attractive stocks outperformed the S&P 500 in March.
Our Most Dangerous Stocks (-5.9%) outperformed the S&P 500 (-5.3%) as a short portfolio last month. Most Dangerous Large Cap stock Summit Materials (SUM) fell by 12% and Most Dangerous Small Cap Stock Consolidated Communications (CNSL) fell by 16%. Overall, 21 out of the 40 Most Dangerous stocks outperformed the S&P 500 in March, and 36 had negative returns.
The successes of these model portfolios highlight the value of our machine learning and AI Robo-Analyst technology[1], which helps clients fulfill the fiduciary duty of care and make smarter investments[2].
16 new stocks make our Most Attractive list this month and 17 new stocks fall onto the Most Dangerous list this month. April’s Most Attractive and Most Dangerous stocks were made available to members on April 4, 2018.
Our Most Attractive stocks have high and rising returns on invested capital (ROIC) and low price to economic book value ratios. Most Dangerous stocks have misleading earnings and long growth appreciation periods implied by their market valuations.
Most Attractive Stocks Feature for April: Winmark Corp (WINA: $130/share)
Winmark Corp (WINA), a specialty consignment retailer, is the featured stock from April’s Most Attractive Stocks Model Portfolio. WINA was also a featured Long Idea in October 2017 and is currently in our Focus List – Long Model Portfolio.
Over the past decade, WINA has grown revenue 8% compounded annually while after-tax profit (NOPAT) has grown 21% compounded annually. Increased profit growth can be attributed to WINA’s NOPAT margin rising from 11% in 2007 to 35% in 2017. The company has also improved its ROIC from 8% in 2007 to 42% in 2017.
