Tag Archives: leisure

Ivy Portfolio December Update

The Ivy Portfolio spreadsheet track the 10-month moving average signals for two portfolios listed in Mebane Faber’s book The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets . Faber discusses 5, 10, and 20 security portfolios that have trading signals based on long-term moving averages. The Ivy Portfolio spreadsheet tracks both the 5 and 10 ETF Portfolios listed in Faber’s book. When a security is trading below its 10-month simple moving average, the position is listed as “Cash.” When the security is trading above its 10-month simple moving average the positions is listed as “Invested.” The spreadsheet’s signals update once daily (typically in the late evening) using dividend/split adjusted closing price from Yahoo Finance. The 10-month simple moving average is based on the most recent 10 months including the current month’s most recent daily closing price. Even though the signals update daily, it is not an endorsement to check signals daily or trade based on daily updates. It simply gives the spreadsheet more versatility for users to check at his or her leisure. The page also displays the percentage each ETF within the Ivy 10 and Ivy 5 Portfolio is above or below the current 10-month simple moving average, using both adjusted and unadjusted data. If an ETF has paid a dividend or split within the past 10 months, then when comparing the adjusted/unadjusted data you will see differences in the percent an ETF is above/below the 10-month SMA. This could also potentially impact whether an ETF is above or below its 10-month SMA. Regardless of whether you prefer the adjusted or unadjusted data, it is important to remain consistent in your approach. My preference is to use adjusted data when evaluating signals. The current signals based on November 30th’s adjusted closing prices are below. This month Vanguard Total Stock Market ETF (NYSEARCA: VTI ) and Vanguard REIT Index ETF (NYSEARCA: VNQ ) are above their moving average and the balance of the ETFs, the Vanguard FTSE All-World ex-US ETF (NYSEARCA: VEU ), the Vanguard Small Cap ETF (NYSEARCA: VB ), the SPDR DJ International Real Estate ETF (NYSEARCA: RWX ), the Vanguard FTSE Emerging Markets ETF (NYSEARCA: VWO ) , the PowerShares DB Commodity Index Tracking ETF (NYSEARCA: DBC ) , the iShares S&P GSCI Commodity-Indexed Trust ETF (NYSEARCA: GSG ), the Vanguard Total Bond Market ETF (NYSEARCA: BND ), and the iShares TIPS Bond ETF (NYSEARCA: TIP ) , are below their 10-month moving average. The spreadsheet also provides quarterly, half year, and yearly return data courtesy of Finviz . The return data is useful for those interested in overlaying a momentum strategy with the 10-month SMA strategy: (click to enlarge) I also provide a “Commission-Free” Ivy Portfolio spreadsheet as an added bonus. This document tracks the 10 month moving averages for four different portfolios designed for TD Ameritrade, Fidelity, Charles Schwab, and Vanguard commission-free ETF offers. Not all ETFs in each portfolio are commission free, as each broker limits the selection of commission-free ETFs and viable ETFs may not exist in each asset class. Other restrictions and limitations may apply depending on each broker. Below are the 10-month moving average signals (using adjusted price data) for the commission-free portfolios: (click to enlarge) (click to enlarge) Disclosures: None.

Valuation Dashboard: Consumer Discretionary Sector

Summary 4 key fundamental factors are reported across industries in the Consumer Discretionary sector. They give valuation status of an industry relative to its historical average. They give a reference for picking stocks in each industry. This is part of a monthly series of articles giving a valuation dashboard in sectors and industries. The idea is to follow up a certain number of fundamental factors for every sector, to compare them to historical averages. This article covers Consumer Discretionary. The choice of the fundamental ratios used in this study has been justified here and here . You can find in this article numbers that may be useful in a top-down approach. There is no analysis of individual stocks. You can refine your research reading articles by industry experts here . A link to a list of stocks to consider is provided in the conclusion. Methodology Four industry factors calculated by portfolio123 are extracted from the database: Price/Earnings (P/E), Price to sales (P/S), Price to free cash flow (P/FCF), Return on Equity (ROE). They are compared with their own historical averages “Avg”. The difference is measured in percentage for valuation ratios and in absolute for ROE, and named “D-xxx” if xxx is the factor’s name (for example D-P/E for price/earnings). The industry factors are proprietary data from the platform. The calculation aims at eliminating extreme values and size biases, which is necessary when going out of a large cap universe. These factors are not representative of capital-weighted indices. They are useful as reference values for picking stocks in an industry, not for ETF investors. Industry valuation table on 11/26/2015 The next table reports the 4 industry factors. For each factor, the next “Avg” column gives its average between January 1999 and October 2015, taken as an arbitrary reference of fair valuation. The next “D-xxx” column is the difference as explained above. So there are 3 columns for each ratio.   P/E Avg D- P/E P/S Avg D- P/S P/FCF Avg D- P/FCF ROE Avg D-ROE Auto Components 15.13 15.33 1.30% 0.83 0.62 -33.87% 33.88 21.23 -59.59% 10.79 3.9 6.89 Automobiles 17.6 17.67 0.40% 1.19 1.06 -12.26% 16.17 21.97 26.40% 10.79 0.21 10.58 Household Durables 17.52 15.46 -13.32% 0.85 0.59 -44.07% 30.1 16.33 -84.32% 9.74 5.3 4.44 Leisure Equip.&Products 22.9 17.82 -28.51% 1.19 0.84 -41.67% 30.76 22.05 -39.50% 9.14 2.63 6.51 Textile,Apparel,Luxury 17.93 16.34 -9.73% 1.02 0.71 -43.66% 27.03 17.23 -56.88% 11.81 7 4.81 Hotels, Restaurants, Leisure 27.67 21.67 -27.69% 1.38 1.04 -32.69% 26.98 24.18 -11.58% 9.24 4.51 4.73 Div. Consumer Services* 27.49 21.49 -27.92% 1.37 1.4 2.14% 17.28 18.64 7.30% 0.36 11.35 -10.99 Media 21.27 23.31 8.75% 1.61 1.55 -3.87% 24.79 19.9 -24.57% 3.43 -3.45 6.88 Distributors 20.07 14.32 -40.15% 1.05 0.48 -118.75% 37.45 16.28 -130.04% 10.21 3.18 7.03 Internet&Catalog Retail 39.1 37.37 -4.63% 1.38 1.8 23.33% 38.36 32.11 -19.46% 5.83 -14.7 20.53 Multiline Retail 20.32 19.41 -4.69% 0.5 0.48 -4.17% 25.87 26.81 3.51% 7.04 10.44 -3.4 Specialty Retail 18.69 17.95 -4.12% 0.58 0.56 -3.57% 24.34 21.87 -11.29% 11.69 9.85 1.84 *Averages since 2005 Valuation The following charts give an idea of the current status of industries relative to their historical average. In all cases, the higher the better. Price/Earnings: Price/Sales: Price/Free Cash Flow: Quality (ROE) Relative Momentum The next chart compares the price action of the SPDR Select Sector ETF ( XLY ) with SPY (chart from freestockcharts.com). (click to enlarge) Conclusion The Consumer Discretionary sector has outperformed the broad market by more than 4% in the last 3 months. It hit a new all-time high this week. The 5 most prominent S&P 500 consumer discretionary stocks in the recent rally are Amazon (NASDAQ: AMZN ), Cablevision Systems (NYSE: CVC ), General Motors (NYSE: GM ), Nike (NYSE: NKE ), Viacom (NASDAQ: VIAB ). AMZN and NKE have hit an all-time high this week. Car and motorcycle manufacturers (Automobiles) look the most attractive industry in the sector: it is fairly priced in P/E, under-priced in P/FCF, and ROE is above the historical average. The industries with an improvement in valuation factors since last month are Auto Components, Household Durables, Leisure equipment and products, Hotels and Restaurants, Specialty Retail. However, there may be quality stocks at a reasonable price in any industry. To check them out, you can compare individual fundamental factors to the industry factors provided in the table. As an example, a list of stocks in Consumer Discretionary beating their industry factors is provided on this page . If you want to stay informed of my updates on this topic and other articles, click the “Follow” tab at the top of this article.

Valuation Dashboard: Consumer Discretionary – November 2015

Summary 4 key factors are reported across industries in the Consumer Discretionary sector. They give a valuation status of industries relative to their history. They give a reference for picking stocks at a reasonable value. This article is part of a series giving a valuation dashboard by sector of companies in the S&P 500 index (NYSEARCA: SPY ). I follow up a certain number of fundamental factors for every sector, and compare them to historical averages. This article is going down at industry level in the GICS classification. It covers Consumer Discretionary. The choice of the fundamental ratios has been justified here and here . You can find in this article numbers that may be useful in a top-down approach. There is no analysis of individual stocks. A link to a list of individual stocks to consider is provided at the end. Methodology Four industry factors calculated by portfolio123 are extracted from the database: Price/Earnings (P/E), Price to sales (P/S), Price to free cash flow (P/FCF), Return on Equity (ROE). They are compared with their own historical averages “Avg”. The difference is measured in percentage for valuation ratios and in absolute for ROE, and named “D-xxx” if xxx is the factor’s name (for example D-P/E for price/earnings). The industry factors are proprietary data from the platform. The calculation aims at eliminating extreme values and size biases, which is necessary when going out of a large cap universe. These factors are not representative of capital-weighted indices. They are useful as reference values for picking stocks in an industry, not for ETF investors. Industry valuation table on 11/2/2015 The next table reports the 4 industry factors. For each factor, the next “Avg” column gives its average between January 1999 and October 2015, taken as an arbitrary reference of fair valuation. The next “D-xxx” column is the difference as explained above. So there are 3 columns for each ratio. P/E Avg D- P/E P/S Avg D- P/S P/FCF Avg D- P/FCF ROE Avg D-ROE Auto Components 18.17 15.33 -18.53% 0.8 0.62 -29.03% 45.52 21.23 -114.41% 10.44 3.9 6.54 Automobiles 14.35 17.67 18.79% 1.02 1.06 3.77% 16.58 21.97 24.53% 15.1 0.21 14.89 Household Durables 19.24 15.46 -24.45% 0.89 0.59 -50.85% 31.14 16.33 -90.69% 9.04 5.3 3.74 Leisure Equip.&Products 23.65 17.82 -32.72% 1.2 0.84 -42.86% 35.83 22.05 -62.49% 9.54 2.63 6.91 Textile,Apparel,Luxury 17.6 16.34 -7.71% 1.07 0.71 -50.70% 27.43 17.23 -59.20% 12.15 7 5.15 Hotels, Restaurants, Leisure 28.5 21.67 -31.52% 1.43 1.04 -37.50% 30.66 24.18 -26.80% 8.96 4.51 4.45 Div. Consumer Services* 26.05 21.49 -21.22% 1.41 1.4 -0.71% 15.58 18.64 16.42% 1.08 11.35 -10.27 Media 21.57 23.31 7.46% 1.81 1.55 -16.77% 22.28 19.9 -11.96% 3.44 -3.45 6.89 Distributors 19.47 14.32 -35.96% 1.76 0.48 -266.67% 36.08 16.28 -121.62% 10.24 3.18 7.06 Internet&Catalog Retail 30.77 37.37 17.66% 1.35 1.8 25.00% 24.02 32.11 25.19% 4.31 -14.7 19.01 Multiline Retail 20.3 19.41 -4.59% 0.5 0.48 -4.17% 25.27 26.81 5.74% 7.1 10.44 -3.34 Specialty Retail 19.9 17.95 -10.86% 0.6 0.56 -7.14% 25.05 21.87 -14.54% 11.78 9.85 1.93 *Averages since 2005 Valuation The following charts give an idea of the current status of industries relative to their historical average. In all cases, the higher the better. Price/Earnings: Price/Sales: Price/Free Cash Flow: Quality Relative Momentum The next chart compares the price action of the SPDR Select Sector ETF (NYSEARCA: XLY ) with SPY. (click to enlarge) Conclusion The Consumer Discretionary sector has widely outperformed the broad market in the last 6 months. It hit a new all-time high last week. Automobiles (the group of car and motorcycle manufacturers) and Internet & Catalog Retail look the most interesting industries now: they are underpriced relative to historical averages for the 3 valuations factors, and quality is above historical averages. However, there may be quality stocks at a reasonable price in any industry. To check them out, you can compare individual fundamental factors to the industry factors provided in the table. As an example, a list of stocks in Consumer Discretionary beating their industry factors is provided on this page . If you want to stay informed of my updates on this topic and other articles, click the “Follow” tab at the top of this article.