Performance Review
Below is the performance of the Nasdaq 100 watch list from May 9, 2014:
| Symbol | Name | 2014 | 2015 | % change |
| DISCA | Discovery Comm. | 37.33 | 31.33 | -16.07% |
| BBBY | Bed Bath & Beyond Inc. | 61.31 | 71.44 | 16.52% |
| ISRG | Intuitive Surgical, Inc. | 353.06 | 494.32 | 40.01% |
| NTAP | NetApp, Inc. | 34.19 | 35.65 | 4.27% |
| EBAY | eBay Inc. | 50.54 | 58.82 | 16.38% |
| ALTR | Altera Corp. | 32.38 | 44.46 | 37.31% |
| WFM | Whole Foods Market, Inc. | 39.32 | 42.58 | 8.29% |
| SIRI | Sirius XM Holdings Inc. | 3.16 | 3.87 | 22.47% |
| VRSK | Verisk Analytics, Inc. | 60.53 | 73.66 | 21.69% |
| COST | Costco Wholesale | 115.39 | 145.88 | 26.42% |
| LMCA | Liberty Media Corp. | 34.18 | 37.93 | 10.97% |
| SRCL | Stericycle, Inc. | 113.90 | 134.01 | 17.66% |
| CERN | Cerner Corporation | 50.19 | 68.02 | 35.53% |
| CA | CA Technologies | 29.41 | 31.60 | 7.45% |
The average gain of the entire list was +17.78% while the top five stocks (DISCA, BBBY, ISRG, NTAP, EBAY) gained an average of +12.22%. This compares with the gain for the Nasdaq 100 index of +23.41% in the same 1-year time period.
As has frequently been the case, analyst expectations were too optimistic for stocks on the far right (DISCA, CA, CERN, SIRI, NTAP) where the average gains of +10.73%. Likewise, the view was too pessimistic for stocks on the far left (LMCA, ISRG, WFM, COST, BBBY) which averaged +20.44% in the above chart.
The absolute change in Liberty Media (LMCA) and Intuitive Surgical (ISRG) was the most extreme. Liberty Media saw its p/e ratio expand from 20 to 72 while ISRG’s p/e ratio increased from 26 to 39. The increase in the p/e ratio should be expected with the increase in price. However, value oriented investors would have overlooked these stocks simply because of the high p/e ratios and the expectation of lower earnings by analysts in 2014.
Watch List: May 8, 2015
Below are the Nasdaq 100 stocks of interest:
| symbol | Name | Price | P/E | EPS | Yield | P/B | % from yr low |
| GRMN | Garmin Ltd. | 45.94 | 24.44 | 1.88 | 4.2 | 2.56 | 3.07% |
| FOSL | Fossil Group, Inc. | 79.62 | 11.21 | 7.1 | - | 4.14 | 4.21% |
| KLAC | KLA-Tencor Corporation | 59.80 | 28.04 | 2.13 | 3.3 | 19.05 | 4.73% |
| FOXA | Twenty-First Century Fox | 32.79 | 7.79 | 4.21 | 0.9 | 3.53 | 5.74% |
| NWSA | News Corporation | 15.14 | 32.91 | 0.46 | 0.5 | 0.69 | 6.02% |
| AMAT | Applied Materials, Inc. | 19.69 | 20.95 | 0.94 | 2 | 2.98 | 6.55% |
| NTAP | NetApp, Inc. | 35.65 | 18.76 | 1.9 | 1.8 | 3.16 | 6.75% |
| SNDK | SanDisk Corp. | 67.72 | 20.50 | 3.3 | 1.8 | 2.37 | 7.50% |
| MU | Micron Technology, Inc. | 27.18 | 8.36 | 3.25 | 0 | 2.36 | 7.64% |
| FAST | Fastenal Company | 42.72 | 24.98 | 1.71 | 2.6 | 6.63 | 8.26% |
| ALXN | Alexion Pharmaceuticals | 163.02 | 55.85 | 2.92 | - | 9.25 | 8.64% |
| WYNN | Wynn Resorts Ltd. | 117.84 | 16.41 | 7.18 | 4.6 | -399.82 | 8.84% |
| DTV | DIRECTV | 89.38 | 16.55 | 5.4 | 0 | -8.56 | 9.00% |
| DISCA | Discovery Communications | 31.33 | 18.92 | 1.66 | - | 3.82 | 9.09% |
Analyst Estimates
This list assumes a price-to-earnings ratio (P/E) that remains the same as indicated above and the percentage change in price that is implied based on analyst low earnings estimates.
Our recommendation is to start with the companies that have the worst prospects, according to the analysts, and through a process of elimination determine which company has the least risks.