ValuEngine Weekly: Industrial Product Stocks, Fed Decision, Southwest Airlines, and ValuEngine Capital

8/20/2019 ValuEngine Weekly: Industrial Product Stocks, Fed Decision, Southwest Airlines, and ValuEngine Capital

1/8

December 18, 2015

If you no longer wish to receive this free newsletter, CLICK HERE to unsubscribe

The ValuEngine Weekly is an Investor Education newsletter focused on the quantitative approach toinvesting and the tools available from In today's fast-moving and globali ed financial markets! it is easy to

get overloaded with information" The winners will adopt an ob#ective! scientific! independent andunemotional approach to investing" If you are not yet a member of ValuEngine's stock analysis service!

sign up now for a two-week free trial at www"valuengine"com $

VALUATION WATCH: Overvalued stocks now make up 41 !"# o$ ourstocks ass%&ned a valuat%on and 1' ()# o$ t*ose e+u%t%es are calculated to,e overvalued ,- ./# or more 0%ve sectors are calculated to ,eovervalued

MARKET OVERVIEW

Inde 2tarted week 0r%da- 3 C*an&e C*an&e # -td56IA %& &&"%% %& ()" 741 (1 7/ .4# 7' '/#

NA25A8 *+( ",% *+) "(, 1( ") / 4/# 4 ""#

9U22 LL ./// %% (",( %% ," ' 1( / .!# 7; 4;#

2


2/8

SECTOR OVERVIEW

2ector C*an&e T5 =T5 Valuat%on Last 1.7

9eturn

3>

9at%oAerospace -."*)/ -*"&%/ -%"% / %" &/ undervalued -%"&,/ %+" &

Auto7T%res7Trucks -%" )/ -)" */ -+" */ %(".*/ undervalued -% " %/ % "

?as%c ater%als -%" / -,")+/ - ".,/ % ")*/ undervalued - %"+./ "*(

?us%ness 2erv%ces -."+*/ -(" */ .".(/ " +/ overvalued -*"( / *",%

Computer and Tec*nolo&- -."(&/ -("+(/ -."%,/ %".*/ overvalued -%" / &"+&

Construct%on -%"(./ -,"(,/ - "%(/ ("+)/ undervalued -)".%/ .".(

Consumer 5%scret%onar- -%"%./ -(")+/ -%" / )"%+/ undervalued -("&*/ *"*

Consumer 2taples -.",+/ -%")+/ (" / )"(*/ overvalued ")+/ ("(&

0%nance -.",./ -("(+/ -."(./ .", / undervalued -("**/ %,"%

Industr%al 3roducts -."++/ -,"%)/ -%."&+/ &"& / undervalued -%%".)/ %&"&(

ed%cal -."%+/ -(".(/ ") / ."+%/ overvalued .")+/ "&

ult%72ector Con&lomerates -%")+/ -)"+ / -%*",,/ .",+/ overvalued -% " ,/ %,")(

O%ls7 ner&- - "&%/ -%(" %/ - +"+./ %+" &/ undervalued -(&"&,/ ("%

9eta%l7W*olesale -%")*/ -("(./ -+")+/ "()/ undervalued -&".(/ "+)

Transportat%on -%"&(/ -&") / -% ") / % "(*/ undervalued - )". / %(",%

Ut%l%t%es ."% / -(".(/ - " )/ "++/ undervalued - "*(/ %"+(

Sector Talk—I !"#tr$al %ro!"ct#Below, we present the latest data on leading Industrial Products Sector stocks

from our 3ro$ess%onal 2tock Anal-s%s 2erv%ce These results were filtered by marketprice and volume--no results below 3 !share or less than "##k shares!day volume$

Top70%ve Industr%al 3roducts 2ector 2tocks772*ort7Term 0orecast 9eturnsT%cker Compan- Name arket 3r%ce Valuat%on Last 1.7 9etrnU 32 0ET % 1E23 TE45 %("*( -,". / ".(/

?922 6789:7 9;4 57< %")) 0=: &+"*(/LA@ 7:>E7:0< I0


3/8

Top70%ve Industr%al 3roducts 2ector 2tocks77Lon&7Term 0orecast 9eturnsT%cker Compan- Name arket 3r%ce Valuat%on Last 1.7 9etrnU 32 0ET % 1E23 TE45 %("*( -,". / ".(/

?922 6789:7 9;4 57< %")) 0=: &+"*(/

LA@ 7:>E7:0< I0E7:0< I0


4/8

&ree Do' loa! (or Rea!er# (s a 0onus to our Free Weekly #ewsletter su0scri0ers,

we are offering a F.EE $W#&$( of one of our Stock .eports

Southwest %irlines &'()* is a ma+or domestic airline that provides primarilyshorthaul, high-fre uency, point-to-point, low-fare service$ Southwest operates overBoeing 3 aircraft in numerous cities$ Southwest has the lowest operating coststructure in the domestic airline industry and consistently offers the lowest and simplestfares$ Southwest also has one of the best overall .ustomer Service records$

)alu/ngine continues its B(0 recommendation on S1(T2 /ST %I4 for 5#"6-"5-" $ Based on the information we have gathered and our resulting research, we feelthat S1(T2 /ST %I4 has the probability to 1(TP/47148 average marketperformance for the ne9t year$ The company e9hibits %TT4%.TI)/ .ompany Si:e andSharpe 4atio$

.ead our 1omplete etailed Valuation .eport on Southwest (irlines H 9

Valu n&%ne 0orecast

TargetPrice*/9pected

4eturn

1 !onth "#$%" #$;;<

# !onth ""$#& "$; <

' !onth ""$"" 5$"3<1 (ear ")$'& ""$=6<

(ear ""$+# "$5#<

# (ear "1$1 -6$>3


5/8

Valuat%on < 9ank%n&s-aluation 1 $1 . un/ervalue/ -aluation Ran0 23 ?5

1 ! 4orecast Return +$%%. 1 ! 4orecast Return Ran0 ;

1 ! Return )$" . !o5entu5 Ran0 23 66har7e Ratio +$%1 6har7e Ratio Ran0 23 ;>

( 8vg 8nnual Return "$&". ( 8vg 8nnual Rtn Ran0 ;>

-olatility &$+ . -olatility Ran0 23 ?5

E97ecte/ EP6 :rowth 1'$1 . EP6 :rowth Ran0 23 6>

!ar0et Ca7 billions3 %$ # 6i;e Ran0 ;

Trailing P


6/8

standby unemployment figure for Afull employmentA of 6< may be outdated given thechanging demographic nature of the (S work force, the depth and breadth of theBush economic crisis, and the long-standing stagnation in wages for many workers$

e keep in mind that the 7ed has a two-pronged mandateG controlinflation!integrity of the money supply %H ensure Afull employment$A e don@t seeinflation at any meaningful level$ In fact, inflation has run below its preferred level&5


7/8

Val"E .$ e Ca/$tale are pleased to announce the formation of )alu/ngine .apital, a registered

investment advisory firm that will offer clients investment-management services based

on industry-leading )alu/ngine research$ )alu/ngine .apital melds the cutting-edgefinancial theory of )alu/ngine@s award-winning uantitative independent researchwith the best real-world all St$ practices$ )alu/ngine .apital offers refinedinvestment portfolios for investors of all risk-reward profiles$

e will initially be offering two investment strategies to clients, the )alu/ngine)iew Strategy and the )alu/ngine 8arket Heutral StrategyG

)alu/ngine )iew StrategyG The )alu/ngine )iew Strategy is the product of asophisticated stock valuation model that was first developed by)alu/ngine@s academic research team$ It utili:es a three factor approachGfundamental variables such as a company@s trailing "5-month /arnings-Per-Share &/PS*, the analyst consensus estimate of the company@s future "5-month /PS, and the 3#-year Treasury yield are all used to create a moreaccurate reflection of a company@s fair value$ % total of eleven additionalfirm specific variables are also used$ The )alu/ngine )iew Strategy isconstructed by integrating this model along with some basic rules formarket capitali:ation and industry diversification$ The portfolio has "6 stocksand is rebalanced once each month$

)alu/ngine 8arket Heutral StrategyG The )alu/ngine 8arket HeutralStrategy is the product of )alu/ngine@s 7orecast 8odel$ This model wasdeveloped by a team of Ph @s and is based on the cutting edge economictheories of all Street professionals and Ivy 'eague academics$ ecarefully e9amine do:ens of fundamental and technical factors for over=,### individual stocks, synthesi:e the data, and then come up with asector-diverse list of our best and worst forecast "-month return stocks$ Shortand long-term historic factors in the )/ 7orecast model@s calculation includepast-valuation levels of the stock and its recent price-momentum factorrelative to other stocks$ The )alu/ngine 8arket Heutral Strategy utili:es7orecast 8odel outputs along with market capitali:ation, price, and sectordiversification rules to construct a monthly portfolio made up of "? stocks for both the long and short sides$

http://www.valuengine.com/nl/NLPerformance?p=Bhttp://www.valuengine.com/nl/NLPerformance?p=Fhttp://www.valuengine.com/nl/NLPerformance?p=Bhttp://www.valuengine.com/nl/NLPerformance?p=F


8/8

Please contact us if you would like to put the power of ValuEngine to work for you at our new full"service money management firm""

ValuEngine 1apital

For more information, please contact us 0y email at info2ValuEngine1apital com or 0y phone at 3+456 748"9:8:

ValuEngine com is an independent research provider, producing 0uy;hold;sell recommendations, target price, and valuations on over 5,444

Documents

ValuEngine Weekly: Industrial Product Stocks, Fed Decision, Southwest Airlines, and ValuEngine Capital