Investment Quality Trends -- one of the most respected newsletters in the advisory field -- uses a proprietary strategy that assesses historic level of stock price to yield; it's goal is to buy those stocks offering the best potential for downside protection and upside appreciation.
Here, editor Kelley Wright explains his methodology and highlights his current "Timely Ten" stocks that best match his time-tested criteria.
"Investors who wished to hold every stock in that we currently rank in the 'Undervalued and Rising Trend' categories, would need to hold one hundred twenty six stocks as of March; clearly too many positions to be practical.
"Our Timely Ten, therefore, is our reasoned expectation based on our methodology and experience for what we believe will perform best over the next five years.
"Do we believe that all 10 will go up simultaneously or immediately? Of course not. Our four decades of research and experience, however, leads us to believe that these stocks, purchased at current Undervalued levels, are well positioned for appreciation.
"Whether you are looking to build a portfolio from scratch, are partially invested and looking to add new positions, or fully invested and in need of some affirmation and hand holding, the Timely Ten represents our top ten recommendations as of each issue.
"The Timely Ten consists of Undervalued stocks that generally have a S&P Dividend & Earnings Quality rating of A- or better, exemplary long-term dividend growth, and a P/E ratio of 15 or less.
"These stocks also generally show a payout ratio of 50% or less (75% for Utilities), debt of 50% or less (75% for Utilities), and technical characteristics on the daily and weekly charts that suggests the potential for imminent capital appreciation."
Here are Investment Quality Trend's most current "Timely Ten" and their respective dividend yields:
General Electric (NYSE: GE) - yield 3.4%
PepsiCo (NYSE: PEP) - yield 2.1%
McDonald's (NYSE: MCD) - yield 2.7%
Rohm & Haas (NYSE: ROH) - yield 2.7%
Johnson & Johnson (NYSE: JNJ) - yield 2.6%
Wal-Mart Stores (NYSE: WMT) - yield 1.8%
Kimberly Clark (NYSE: KMB) - yield 3.6%
Wells Fargo (NYSE: WFC) - yield 4.1%
Jack Henry (NASDAQ: JKHY) - yield 1.2%
Bank of America (NYSE: BAC) - yield 6.6%
Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.
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Reader Comments (Page 1 of 1)
4-11-2008 @ 12:21PM
Michael Goldstein said...
Yes, GE is certainly a value in this 'timely 10', especially today as the stock dives because of missed profit expectation. I was told it was a value when I bought it at 39, so when it hits 29 it will really be a value.
4-14-2008 @ 1:32PM
desktoparchitect said...
Well, I have been commenting now for about 4 months on the health of the B of A stock. The stock has continued to languish at about the same point it held 3 years ago. This value is the same, if you take into account the last stock split, as it was when the FleetBoston Financial merger took place. We have not seen any significant growth in the value of the stock. Yes the dividends have continued to be acceptable but except for the growth in net size of the corporation there is no great advantage to this merger having occured. Nolw we are given the proposed merger with NationWide is this also going to be another aquisition which fails to provide a notable gain For B of A? I continue to think that I probably will be. Why doesn't the B of A board of directors get back to the basics and grow their banking buisness.