Category Archives: Performance Review

Performance Review: Helmerich and Payne

On January 15, 2017, we reviewed Helmerich and Payne (HP) after it achieved our July 2, 2016 upside target of $79.16.  At the time, we reflected on the following thoughts:

“The only question now is the selling of the stock.”

For all intents and purposes, HP should have been considered for selling the principal or the entire position.  Since the January 15, 2017 posting the stock has had the following price action:

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Our fear then was, “Can we handle see[ing] the stock fall back to where we bought it?”  This thought only comes to mind when or if the stock price substantially exceeds the norm for an individual investment.  At the time, HP had annualized gains of more than +60%.

For now, it is back to the drawing board for HP.  We’ll have to re-examine the attributes for the stock to determine if investment is warranted or not.

Canadian Dividend Watch List Review

Performance Review

Below is a graphing of the Canadian Dividend Watch List performance from October 2015.

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The performance of the watch list from October 2015 shows exactly what we suspected. At the time, we said the following:

“Our best guess is that the analysts are too optimistic.  We’d aim for the stocks that are slated to generate average returns going forward.”

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When compared to the other categories, our guess that the group marked as “average”  would exceed the analyst expectations was fairly accurate.  As luck would have it, our perspective prevailed while exceeding the Toronto Stock Exchange.  Click on the above “analyst estimate” chart to see how we ranked the stocks for each category.

Performance Review: Family Dollar

On March 31, 2014, we summarized our thoughts on Family Dollar (FDO) in a Quick Take posting with the following:

“Falling below the $55.07 support line suggests that FDO could decline to $47 in the near term.  Investors interested in FDO could break their investment into at least two purchases, the first being 60% of the intended amount now and the second purchase of 40% at either of the two indicated support levels at $44.95 or $34.83.”

Like moths to a flame, we were encouraged by Value Line Investment Survey’s assessment that “…would-be investors to look else-where.” As we saw it, the fundamentals and technicals supported the idea that Family Dollar was worth investing in (at least 60% of funds committed as part of a balanced portfolio).

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2014 Performance Review

Below is a chart of how our investment portfolio performed against the S&P 500 index and the 30-year Treasury based on the January 2, 2014 rate (found here).

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Reconsidering “Sell In May”

Below is the one year performance of our March Dividend Watch Lists for 2010, 2011, 2012 and 2013.  While the Wall Street adage says “Sell in May and Go Away,” we’d like to know what the market would look like if an investor bought our “Top Five” stocks before May and held for the following year.

First up is the March 26, 2010 watch list (found here).  The chart is organized based on the stocks nearest the new low on the left.  For the year, our Top Five stocks (XOM, FPL, MON, TMP, BRO) gained an average of +20.86% as compared to the Dow Jones Industrial Average gains of +12.63%.  In this example, the Top Five stocks provided above average gains.  Within the context of the gains that were made one year later, the Dow Jones Industrial Average experienced a decline of –14.60% from the April 2010 high to the July 2010 low.  As a note, FPL bought PGN and trades under a new symbol NEE.

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Next up is the 2011 watch list (found here).  For the year, our Top Five stocks (SJW, SYY, WABC, PPL, TGT) gained an average of +8% as compared to the Dow Jones Industrial Average gains of +7.04%. In this example, the Top Five stocks provided moderate gains. Within the context of the gains that were made one year later, the Dow Jones Industrial Average experienced a decline of –19.19% from the May 2011 high to the October 2011 low. As a note, HGIC and TRH were both acquired.

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The Dividend Watch list below is from March 23, 2012 (found here).  For the year, our Top Five stocks (TR, CHRW, CLX, ATO, CWT) gained an average of +18.32% as compared to the Dow Jones Industrial Average gains of +10.94%. In this example, the Top Five stocks provided exceptional gains. Within the context of the gains that were made one year later, the Dow Jones Industrial Average experienced a decline of –10.70% from the May 2012 high to the June 2012 low.  Additionally, the Dow Jones Industrial Average declined –8.71% from October 2012 to mid-November 2012.

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The next Watch List is from March 22, 2013 (found here).  The Top Five stocks (CATO, FDS, CTWS, EXPD, BCR) gained an average of +20.78% which was below the +23.12% gained by the entire list.  During the same period of time, the Dow Jones Industrial Average gained +12.53%.

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Even with the view of “Sell in May and Go Away,” the Top Five stocks on our U.S. Dividend Watch List have performed quite well.  The average gain over the four periods reviewed was +16.99% compared to average gain of the Dow Industrials at +10.78%.

All good things must come to an end.  We do not expect that the stock market will be as forgiving in the next four years as it has in the last four years.  However, we recommend considering our Top Five stocks from the latest dividend watch list for potential short and long-term investment opportunities, even if the mantra is “Sell in May.”