Stingy Selections & Dartboard Dynamos 03
Last year I attempted to achieve success by hand picking twelve
value stocks from the S&P500. Well, I managed to avoid the success
part. My twelve picks lost an average of 1.92% from December 5, 2001
to December 5, 2002. Mind you, this was much better than the S&P500
which fell by 22.12% over the same period. Normally outperforming the
index by 20.20% would be cause for celebration but a loss is still a
loss. To add insult to injury, the stocks selected by my trusty
dartboard gained 2.87% over the same period.
Last year's stingy picks: Alberto-Culver (ACV), Allegheny Technologies
(ATI), Cardinal Health (CAH), CVS Corp (CVS), Engelhard (EC), FedEx
(FDX), Humana (HUM), SYSCO Corp (SYY), VF Corp (VFC), W.W. Grainger
(GWW), WellPoint Health Networks (WLP) and Worthington Industries
(WOR).
Last year's dartboard picks: Alberto-Culver (ACV), Big Lots (BLI),
Burlington Resources (BR), Charter One Financial (CF), Citizens
Communications Co (CZN), FMC Corp (FMC) HCA Inc. (HCA), Hercules Inc
(HPC), Lincoln National Corp (LNC), Meredith Corp (MDP), UnitedHealth
Group (UNH) and Zions Bancorp (ZION).
Undaunted by my crushing defeat, I've selected a new list of
stingy picks. This year, I'm sticking to S&P500 stocks with
debt-to-equity ratios of less than 0.5, current ratios of more than
two, and interest coverage ratios of more than two. Also, I demand
positive cash flow, some earnings and a price-to-sales ratio of less
than one.
With the aid of the MSN.com stock screener, ten stocks were found
that passed my tests on December 5, 2002. I should note that I
currently own shares in Apple Computer due to its very strong balance
sheet.
Stingy Picks: Apple Computer (AAPL), Circuit City Group (CC),
Crane Co. (CR), Dollar General Corporation (DG), Limited Brands,
Inc. (LTD), Liz Claiborne, Inc (LIZ), Nucor (NUE), Quintiles
Transnational Corp. (QTRN), Reebok International Ltd. (RBK) and VF
Corporation (VFC).
My nemesis is back with ten picks from S&P500.
The Dartboard's picks: AFLAC Incorporated (AFL), AmerisourceBergen
Corporation (ABC), Bank of New York Company (BK), Chiron Corporation
(CHIR), Consolidated Edison (ED), Fiserv (FISV), Illinois Tool Works
(ITW), KeySpan Corporation (KSE), QUALCOMM Incorporated (QCOM) and
United Technologies Corporation (UTX)
Which portfolio will win? Value or blind luck? Only time will tell.
Date: Jan 2003
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