March 19, 2013 Performance Review
Below is the performance of the nine stocks from our March 19, 2013 Nasdaq 100 watch list (found here) compared to the performance of the Nasdaq 100 Index gain of +29.63% over the last year.
| Symbol |
Name |
2013 |
2014 |
% change |
| GRMN |
Garmin Ltd. |
34.23 |
52.19 |
52.47% |
| BIDU |
Baidu, Inc. |
84.81 |
160.59 |
89.35% |
| NUAN |
Nuance Communications, Inc. |
18.51 |
15.95 |
-13.83% |
| ISRG |
Intuitive Surgical, Inc. |
481.76 |
423.07 |
-12.18% |
| WFM |
Whole Foods Market, Inc. |
43.07 |
53.93 |
25.21% |
| MSFT |
Microsoft Corporation |
28.08 |
37.7 |
34.26% |
| ROST |
Ross Stores Inc. |
55.81 |
72.67 |
30.21% |
| AAPL |
Apple Inc. |
458.91 |
524.69 |
14.33% |
| LMCA |
Liberty Media Corporation |
111.5 |
135.25 |
21.30% |
|
|
|
Average |
+26.79% |
Below is the performance of the top five stocks on the watch list from last year. The average gain was +28.20%.
Garmin (GRMN) was a stock of interest to us last year. While we liked GRMN, we suggested that the stock had downside risk of –22%. In retrospect, potentially losing –25% was a decent risk/reward proposition. Last month we recommended that the principal be sold in GRMN in order to secure investment gains. For now, the stock has declined marginally.
We highlighted Intuitive Surgical (ISRG) with a concern that the stock had price gains without the necessary rising trading volume. We said the following:
“As with our observation on Apple’s (AAPL) contracting volume as the price rose, ISRG has experienced the same phenomenon (found here). In addition, as ISRG has declined recently, the amount of average volume has increased dramatically. This suggests that there may be support for the idea that this stock could fall much lower from the current levels.”
Dow Theory indicated that downside risk was to $426 and $342 levels. Although ISRG easily achieved the $426 downside target the $342 target was missed by 2.5%. As seen in the performance chart above, ISRG declined as much as –26% within the last year and currently lingers with a –12% loss.
The last stock that we mentioned was Whole Foods Market (WFM). We said the following of WFM:
“Finally, Whole Foods (WFM) is on our watch list for the first time since the July 23, 2009 Dow Theory bull market initiation of the New Low Observer. In the run up to the 2005 peak and December 2008 bottom, Whole Foods had had increasing volume all the way. However, as the stock price rose from the 2008 low, Whole Foods has had a continued decline in trading volume. More recently though, the decline from the October 5, 2012 top has resulted in higher average volume indicating that those wishing to get out are doing it in “droves.” Dow Theory suggests that the following downside targets are $70.25, $54.44 and $38.64. Whole Foods falling to the $70.25 level could mean that the situation is dire, from a price standpoint.”
Since our commentary on Whole Foods, the stock has only increased in value. In fact, March 19, 2013 marked a lull in the stock price before rising nearly +52%.
The performance of Whole Foods Market was in stark contrast to our analysis at the time. This reiterates the importance of considering stocks on our watch list as a decent starting point for investment opportunities.
March 14, 2014 Nasdaq 100 Watch List
Below are the eight Nasdaq 100 stocks that are of interest to us.
