Value Stock Screen Performances YTD

I keep track of 10 value stock screens on this site and so far the 2010 YTD performance has been impressive.

These value screens are built more from logic and common sense rather than the standard low PE PB ratios and high ROE’s.

Value Stock Screen Performances 2010 YTD

The S&P 500 and Russell 2000 index returns are the price returns you would expect after fees, not the net performance.

Insider Buys Value Screen

As the name suggests, a screener that tracks insider buying activity. Based on the simple idea that the insiders supposedly know best about their own company.

This screen looks for insider transactions where there are at least 10 purchases and less than 1 sales transaction. In other words, a stock where insiders have heavy conviction that their stock is cheap.

More insider buys backtesting and results can be found. I also believe the reason why this screen is working out so well is because of the momentum and buzz around heavy insider buying news.

Best 5 Performers

  • KEMET Corp [[KEM]] : +220.8%
  • Rotech Healthcare [[ROHI]] : +210.8%
  • Charles & Colvard [[CTHR]] : +99.1%
  • DDi Corp [[DDIC]] : +94.12%
  • One Liberty Properties [[OLP]] : 72.68%

Worst 5 Performers

  • ValueVision Media [[VVTV]] : -64.33%
  • TranS1 Inc [[TSON]] : -40%
  • Reddy Ice Holdings [[FRZ]] : -31%
  • SuperGen [[SUPG]] : -27.38%
  • AdCard Health Systems [[ADK]] : -10.5%


Share Buyback Value Screen

Share buybacks have the advantage of reducing the number of shares outstanding, which will increase EPS. Companies can then report higher EPS in later periods even though nothing has changed. Since Wall Street glorifies EPS, this should serve to increase the stock price.

Share repurchase plans also gives the view to the general public that management considers their company stock to be cheap enough to buy. This isn’t always the case, but the perception is true.

Another view is that the company is buying back shares because they have ample cash lying around. Repurchase programs are also announced publicly which provides greater exposure.

Best 5 Performers

  • Bodisen Biotech [[BBCZ]] : +139.2%
  • Escalade [[ESCA]] : +122%
  • Banks.com [[BNX]] : +66.7%
  • BreitBurn Energy Partners [[BBEP]] : 55.19%
  • USEC Inc [[USU]] : 43.6%

Worst 5 Performers

  • K-V Pharmaceutical Company [[KV.A]] : -68.1%
  • Radio One [[ROIAK]] : -64.73%
  • VaxGen [[VXGN]] : -40%
  • SkyWest [[SKYW]] : -29%
  • Hornbeck Offshore Services [[HOS]] : -27.26%

NNWC Increasing

Warren Buffett has said that the best way to value Berkshire Hathaway is to calculate the book value of the company. I’ve taken it one step further by applying the same logic to the Graham principle of Net Net Working Capital.

A company that is able to increase cash, accounts receivables and/or inventory at a much higher rate than debt over consecutive years is a sign of well run operations leading to gains in stock price.

So far, the theory seems to be holding true as the screen is up 7% YTD.

Best 5 Performers

  • Lattice Semiconductors [[LSCC]] : +92.3%
  • AXT Inc [[AXTI]] : +73.8%
  • Integrated Silicon Solution [[ISSI]] : +44.5%
  • EF Johnson Technologies [[EFJI]] : +33%
  • Atmel Corporation [[ATML]] : +28.8%
  • JAKKS Pacific [[JAKK]] : +27.52%

Worst 5 Performers

  • Alvarion [[ALVR]] : -46.5%
  • Hooper Holmes [[HH]] : -45.6%
  • The Spectranetics Corporation [[SPNC]] : -25.7%
  • Zoran [[ZRAN]] : -23%
  • Affymetrix [[AFFX]] : -16.44%

Negative Enterprise Value Screen

Since enterprise value accounts for debt and subtracts the excess cash from the equation, if EV results in a negative number, the conclusion is that the company is loaded with excess cash, hence a cash rich company trading for less than it’s value.

If you look at NCAV stocks in the Graham cheap stock screen, you will see that many companies are loaded with inventory or receivables, but a company with negative EV will have a higher percentage of assets in cash. That is, higher quality of assets.

Best 5 Performers

  • MIND C.T.I. [[MNDO]] : +105.3%
  • TTI Team Telecom International [[TTIL]] : 90.8%
  • PDI Inc [[PDII]] : +73.75%
  • Forward Industries [[FORD]] : +66%
  • Bonso Electronics [[BNSO]] : +57.14%

Worst 5 Performers

  • Soapstone Networks [[SOAP]] : -97%
  • United American Healthcare [[UAHC]] : -50%
  • EDCI Holdings [[EDCI]] : -43.8%
  • Jacada [[JCDA]] : -33.3%
  • Thomas Group [[TGIS]] : -32.2%

Piotroski F Score Screen

The very popular Piotroski screen is living up to its name of uncovering strong businesses with great fundamentals based on Piotroskies 9 point system.

(If you sign up to receive articles with your email, you can download the latest Piotroski spreadsheet as well as 8 other stock spreadsheets)

Best 5 Performers

  • Domino’s Pizza [[DPZ]] : +49.4%
  • Dollar Tree [[DLTR]] : +33%
  • Tractor Supply [[TSCO]] : 30.8%
  • 99 Cents Only Stores [NDN]] : +30.3%
  • The Hershey Company [[HSY]] : +27.8%

Worst 5 Performers

  • LodgeNet Interactive [[LNET]] : -40.4%
  • Quest Diagnostics [[DGX]] : -20.7%
  • Ambassadors Group [[EPAX]] : -13.6%
  • Central Garden & Pet Co. [[CENT]] : -11.8%
  • SAIC [[SAI]] : -10.7%

Remaining screens will be covered in the next article.

Disclosure

None

About Jae Jun


Jae Jun is the founder of Old School Value. He is on a mission to provide practical and actionable value investing tools, tutorials and educational material to help empower the individual investor. Keep in touch with Jae via any of the methods linked below.

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  • bellamyj

    Nice post. Just a minor note on your negative EV results – SOAP paid a large dividend in April. Accounting for that, the return was actually slightly positive if you had bought at the beginning of the year.

  • http://www.oldschoolvalue.com Jae Jun

    Thanks for letting me know. The negative screen should have performed much better than.

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