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.

Continue reading The Timely Ten: Best stocks for quality and yield

The Timely Ten: Best stocks for quality and yield originally appeared on BloggingStocks on Fri, 11 Apr 2008 10:00:00 EST. Please see our terms for use of feeds.

For 25 years, Steven Halpern, editor of TheStockAdvisors.com, has surveyed the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is one of 100+ ideas in the Best Stocks for 2008 report.

"My favorite conservative idea for 2008 is Sigma-Aldrich (NASDAQ: SIAL), one of the world's largest providers of research chemicals, reagents, chromatography products, and related products," says Kelley Wright, editor of Investment Quality Trends.

"SIAL distributes more than 100,000 chemical products for use primarily in research and development, diagnosis of disease, and as specialty chemicals for manufacturing.

"The company believes it is the leader in the worldwide market for research chemicals, estimated at about $8.75 billion, with annual revenue growth of 3%-4%. The worldwide market for fine chemicals is estimated at $50 billion, with annual growth of 2%-3%. SIAL projects that it ranks among the top ten players in the fragmented fine chemical industry.

"The company's balance sheet is relatively strong, with a total debt-to-capital ratio of 26.6% as of September 30, 2007. This should allow SIAL to make additional acquisitions and further repurchases of its common stock. SIAL has acquired 83 million (adjusted) of its common shares since November 1999.

Continue reading Best Stocks for 2008: Chemical gains at Sigma-Aldrich (SIAL)

Best Stocks for 2008: Chemical gains at Sigma-Aldrich (SIAL) originally appeared on BloggingStocks on Wed, 26 Dec 2007 16:45:00 EST. Please see our terms for use of feeds.

Commenting on the market's volatility, Kelley Wright says, "Damn the torpedoes and full steam ahead." He explains, "These events are what create value and have provided us with opportunity over the years to acquire outstanding companies at excellent price/yield levels. I suspect this time will be no different. Hang in there; this too shall pass."

In his Investment Quality Trends, Kelley Wright select stocks based on quality and yield. In his latest update, he says, "Whenever liquidity, the lifeblood of any market, is compromised, things can get ugly right damn skippy."

However, he remains optimistic for the long-term. He notes, "Fundamental measures of value are fundamental for a reason; they don't change with the whims of the day. The markets are a self-regulating mechanism that restores order when excess exceeds a sustainable level."

Meanwhile, he notes that he continues to recommend several blue chip equity. He says, "We have been long Barrick Gold (NYSE: ABX) in our model portfolio since 2003, when the stock traded in the high teens. We buy more every time it falls into our undervalued category, such as now. With the U.S. dollar under pressure, it makes even more sense."

The advisor also likes Automatic Data Processing (NYSE: ADP). He notes, "ADP is undervalued by our proprietary measures, has an S&P earnings and dividend quality ranking of A-plus, has had at least 10% annual dividend growth for the past 12 years and has a 55% or better return on equity."

In addition, he sees value in Colgate-Palmolive (NYSE: CL). He explains, :The stock also has a quality ranking of A-plus. It has also shown 10% annual dividend growth over the past 12 years. If things turn ugly, this stock should hold up nicely."

Each day, Steven Halpern's TheStockAdvisors.com features the latest investment ideas and market commentary from the financial newsletter community.

Blue chips with quality and yield originally appeared on BloggingStocks on Tue, 07 Aug 2007 15:25:00 EST. Please see our terms for use of feeds.

Each year Steven Halpern, editor of TheStockAdvisors.com, surveys the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is part of his 24th annual Top Picks Report.

Citigroup Inc. (NYSE: C) is the top conservative investment for 2007 from Kelley Wright. The editor of Investment Quality Trends notes, "I know this company has been public relations-challenged, but let's consider the fundamentals.

"First, it's not only undervalued, it's trading almost 71% below its historic undervalued dividend yield of 2.20%. In dollar terms, the stock can appreciate $37 to $89 and still represent excellent historic value!

"Second, the stock has earned an A+ ranking by S&P for earnings and dividend quality; S&P doesn't hand out an A+ easily. The stock has also earned our 'G' designation, which denotes a remarkable 10% annual dividend growth over the past 12 years. And, the stock has a P/E of 11 and is trading right at 2 times book value; numbers Benjamin Graham would like.

"CEO Charles Prince is feeling the heat on unlocking shareholder value. Based on recent management restructuring, it appears they will attempt to boost earnings by cutting costs and trying to squeeze value from every corner of this far-flung enterprise. At the end of the day though, I think Prince will have to do more and the Street will reward those efforts."

To see Kelley's favorite speculative idea for 2007, click here.

Top Picks 2007: Kelley Wright banks on Citi for safety originally appeared on BloggingStocks on Mon, 01 Jan 2007 14:30:00 EST. Please see our terms for use of feeds.

Each year Steven Halpern, editor of TheStockAdvisors.com, surveys the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is part of his 24th annual Top Picks Report.

Popular, Inc. (NASDAQ: BPOP) is the top speculative play for 2007 from Kelley Wright. The editor of Investment Quality Trends notes, "We aren't big risk takers. That being said, Popular is an interesting undervalued idea.

"First the numbers: an A+ S&P Earnings and Dividend Quality Ranking; our designation for spectacular annual dividend growth of at least 10% for the last 12 years; a P/E of 12; and the stock is trading at less than 2 times book. The stock's historically undervalued yield is 3.10%. Based on the current dividend of $0.64, that equates to a price of $21, and the stock is trading around $17.50.

"The customer base for Popular is the fastest growing demographic in North America: Hispanics. Popular has found a way to market and deliver banking and other financial products to this group, which has traditionally not trusted financial institutions because of their negative experiences with banks in their country of origin.

"We believe this will not go unnoticed by larger, more established banks in the B of A genre. Even without a buyout by another institution, the stock just needs to climb back to its undervalued area to return approximately 18% before the dividend. While 2006 was a disappointing year for BPOP shareholders, we believe 2007 should be a turnaround year and shareholder patience will be rewarded."

To see Kelly's favorite conservative investment for 2007, click here.

Top Picks 2007: IQ Trends banks on a "Popular" pick originally appeared on BloggingStocks on Sat, 23 Dec 2006 14:30:00 EST. Please see our terms for use of feeds.

Despite the market's sharp downturn, The Home Depot, Inc. (NYSE: HD) continues to garner buy ratings from the financial newsletter community. Following my recent post - Home Depot: Bad News Bottom? - the stock is now the latest featured recommendation from Kelley Wright, editor of Investment Quality Trends.

Kelley, whose strategy is based on assessing a stock's value relative to its historic dividend yield - is very optimistic over Home Depot's recent dividend boost. The company announced a 50% increase in their annual dividend from $.60 to $.90 per share, putting the new dividend yield at around 2.40%. Says Kelley, "This is significantly above HD's historic Undervalued yield of 1.0%, and highlights the firm's spectacular dividend growth."

The advisor admits that the yield may appear "paltry" versus other higher-yielding stocks, but he reminds investors to consider the "magic that takes place with a consistently rising dividend trend."

For example, he first added the stock to the IQ Trends portfolio in 2003, at a time when its dividend provided a yield of just 0.8%. Since then, the dividend has risen over 300%.

When combined with the 6% per year annual price appreciation, he notes, his holding in the stock has "delivered an excellent compounded return that has far exceeded the level of inflation."

For those seeking long term growth of capital and income, Kelley concludes, "Home Depot offer excellent current value and upside potential. The stock fits the profile of a bedrock position that every enlightened investor should have in their portfolio."

Home Depot is 'Bedrock Buy' thanks to increasing dividends originally appeared on BloggingStocks on Fri, 01 Dec 2006 17:15:00 EST. Please see our terms for use of feeds.

With the top risk-adjusted performance rating among all newsletters for the past 15 years, Investment Quality Trends uses a proprietary dividend-based strategy to isolate value among conservative, blue chip stocks. As part of its service, editor Kelley Wright maintains a "Timely Ten" portfolio, representing his current favorite blue chips.

Just added to "Timely Ten" is Wal-Mart Stores, Inc. (NYSE: WMT). Says IQ Trends, "The company has been everyone's favorite target for scorn. But having divested its European properties and focusing on gaining their banking charter, WMT is positioning itself to make some hay."

"Not unnoticed by us," he continues, "is that the Holidays are quickly approaching and Wal-Mart will definitely pull in their share of revenues. When they get the Feds to grant them their banking charter this company will create incredible earnings."

More background on the Timely Ten: Says Kelley, "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 presents our top ten recommendations.

To earn its place on the Timely Ten list a stock must meet strict criteria including an unvalued ranking, an S&P dividend & earnings quality rating of A- or better, a P/E ratio of 15 or less, a payout ratio of 50% or less and debt of 50% or less.

Also, to be included, notes Kelley, the stock must have "an exemplary long-term dividend growth record, and technical characteristics on the daily and weekly charts that suggests the potential for imminent capital appreciation."

Steven Halpern is editor of TheStockAdvisors.com, a guide to financial newsletters.

Wal-Mart earns spot on 'Timely Ten' list of top stock newsletter originally appeared on BloggingStocks on Fri, 13 Oct 2006 15:03:00 EST. Please see our terms for use of feeds.