A Little Consistency, Please

Earnings: It’s been a dirty word for the past several months, as companies across the country have been posting some ugly results and slashing estimates of future earnings. Standard & Poor’s is now projecting $54.70 in 2009 operating earnings per share for the S&P 500, and just $41.88 per share in as-reported earnings for the index’s components. By comparison, as recently as 2007, operating earnings for the S&P 500 were $82.54 per share, and as-reported… Read More

Hot List: How to Combine Strategies to Minimize Risk, Maximize Returns

In my new book, The Guru Investor, I detail ten of the best-performing stock-picking strategies of all-time. These guru-based approaches are a great way to get a leg up on the market, but, as I’ve found over the years, having a proven stock-picking methodology is just one part of the path to market-beating returns. Stock investors also must deal with a number of portfolio management questions, such as, “Which strategy is best for me?”, “How… Read More

Reese on New Guru Model, Economy

In his latest Hot List newsletter, Validea CEO John Reese unveils a new guru-based stock selection model, and tells readers that continuing economic woes don’t have to mean continued trouble for the stock market. Reese’s new Guru Strategy is based on the writings of hedge fund master Joel Greenblatt. Greenblatt created quite a stir in the investment world in 2005, when he published “The Little Book that Beats The Market”, in which he explained how… Read More

Reese: Five Reasons for Optimism

In the week’s Validea Hot List newsletter, Validea CEO John Reese says that, despite the continuing troubles with the U.S. economy, he sees several clear reasons long-term investors should be high on stocks heading into 2009. “Good investors must have the ability to look past the near-term and see the forest for the trees,” Reese writes. “To me, the forest that is the stock market looks quite inviting right now.” Five reasons for his optimism:… Read More

Values Abound in Small-Caps

In this week’s Validea Hot List newsletter, John Reese says that his Guru Strategy computer models are finding an array of values among small-cap stocks, particularly among those that would be considered small-cap growth firms. Reese’s Hot List portfolio added eight new stocks on his regularly scheduled rebalancing, all but one of which are in the small-cap growth category — one of the market’s most beaten-down areas of late. For 2008, Reese notes, small-cap growth… Read More

Institutional Ownership Driving Momentum?

Another investment idea that piggy backs off of Bespoke Investment Group’s great research. Bespoke broke down the S&P 500 into groups of 50 based on levels of institutional ownership, and looked at the performance of those groups since the November 20th market low. What they discovered was that those stocks with the highest amount of institutional ownership were the best performers. Specifically, the most widely owned group of 50 stocks was up +35% since 11/20,… Read More

A Growing Chorus of Bulls

In this week’s Validea Hot List newsletter, Validea CEO John Reese writes that “more and more of the world’s most successful investors — including many who correctly believed that the market was overvalued before its recent crash — are saying that stocks are now good values”. Among them are Jeremy Grantham, David Dreman, Jeremy Siegel, Bruce Berkowitz, Warren Buffett, and Marty Whitman. The fact that these gurus are seeing value in the market is a… Read More

Small Caps Leading the Surge

Today we came across some interesting research by Bespoke Investment Group that showed the recent performance of stocks across the ten size-based deciles that make up the S&P 500. The index is up about 20 percent off its Nov. 20 lows, but according to Bespoke, “the average stock in the S&P 500 is up even more at 27.32%. This is because the smallest stocks in the index have outperformed their larger cap brethren … The… Read More