Another month has zipped by. As my faithful readers know, I have been tracking the Magic Formula Stocks as described by Joel Greenblatt in The Little Book That Beats the Stock Market since January 2006. Every month I take the top 50 stocks over $100m market cap from his website and track how that portfolio of stocks fares versus the Russell 3000 for the next 12 months. It has been an uphill struggle as the tracking portfolios have under-performed, driven in part by Chinese reverse merger fiascos, for-profit education stocks and home health care stocks all being proverbial albatrosses.
This month-end was sadly no different, going up an excellent 26.5 %, but still getting edged by the R3K, which was up a more excellent 27.5%! Here are the 50 stocks in descending performance order:
| Stock | Initial Price | End Price | Percent Change | 52 week low | Mkt Cap |
| 1.23 | 2.81 | 128.5% | 2.05 | 190 | |
| 14.54 | 29.19 | 100.8% | 15.00 | 4,401 | |
| ICON | 15.48 | 30.20 | 95.1% | 14.27 | 1,079 |
| 24.09 | 45.18 | 87.5% | 22.37 | 1,122 | |
| 3.56 | 6.40 | 79.8% | 3.63 | 343 | |
| 23.47 | 40.49 | 72.5% | 23.55 | 1,108 | |
| 22.19 | 38.20 | 72.1% | 22.08 | 1,172 | |
| 33.73 | 58.01 | 72.0% | 30.99 | 7,856 | |
| 18.87 | 32.11 | 70.2% | 15.32 | 2,530 | |
| 39.91 | 67.33 | 68.7% | 30.51 | 604 | |
| VG | 1.70 | 2.70 | 58.8% | 2.65 | 391 |
| 44.05 | 66.35 | 50.6% | 41.42 | 2,291 | |
| 15.89 | 23.53 | 48.1% | 14.96 | 88,227 | |
| SAI | 10.29 | 15.23 | 48.0% | 10.69 | 3,591 |
| LPS | 22.84 | 32.99 | 44.4% | 21.14 | 1,909 |
| DENN | 4.16 | 6.00 | 44.2% | 3.88 | 392 |
| CPLA | 31.27 | 44.15 | 41.2% | 25.81 | 416 |
| 5.95 | 8.37 | 40.7% | 6.14 | 907 | |
| 47.93 | 66.73 | 39.2% | 49.03 | 16,613 | |
| 20.12 | 27.04 | 34.4% | 19.02 | 1,406 | |
| 7.00 | 9.10 | 30.0% | 6.82 | 186 | |
| 13.58 | 17.44 | 28.4% | 12.10 | 658 | |
| 21.46 | 27.49 | 28.1% | 19.74 | 819 | |
| 16.38 | 20.75 | 26.7% | 14.17 | 556 | |
| 44.74 | 54.67 | 22.2% | 43.21 | 7,654 | |
| 28.20 | 34.27 | 21.5% | 26.26 | 244,188 | |
| 12.90 | 15.52 | 20.3% | 12.66 | 207 | |
| 33.31 | 39.47 | 18.5% | 26.15 | 1,280 | |
| 16.41 | 18.99 | 15.7% | 14.40 | 723 | |
| USMO | 12.15 | 13.83 | 13.8% | 10.34 | 282 |
| CF | 165.26 | 186.73 | 13.0% | 156.61 | 11,024 |
| 10.82 | 12.00 | 10.9% | 8.05 | 797 | |
| 12.20 | 13.34 | 9.3% | 8.69 | 21,924 | |
| NSU | 3.27 | 3.41 | 4.3% | 2.70 | 699 |
| 4.61 | 4.74 | 2.8% | 4.19 | 680 | |
| EXPR | 18.72 | 19.20 | 2.6% | 10.47 | 1,622 |
| GTAT | 4.30 | 4.38 | 1.9% | 2.61 | 480 |
| CJES | 18.58 | 18.79 | 1.1% | 16.78 | 953 |
| NEMFF | 9.89 | 9.84 | -0.5% | N/A | 1,175 |
| 19.86 | 19.41 | -2.3% | 17.87 | 195 | |
| INTX | 10.15 | 9.91 | -2.4% | 7.83 | 205 |
| MNTA | 13.78 | 13.39 | -2.8% | 10.05 | 710 |
| TNAV | 6.11 | 5.07 | -17.0% | 5.05 | 246 |
| BODY | 15.20 | 12.14 | -20.1% | 7.46 | 240 |
| EGY | 8.04 | 6.27 | -22.0% | 6.07 | 463 |
| ACUR | 3.05 | 2.37 | -22.3% | 1.06 | 127 |
| 6.94 | 5.10 | -26.5% | 4.55 | 215 | |
| 86.28 | 56.24 | -34.8% | 42.98 | 1,023 | |
| 33.12 | 20.99 | -36.6% | 15.98 | 3,922 | |
| 57.90 | 24.80 | -57.2% | 11.69 | 1,361 |
As you can see, the Education stocks were (again) laggards. If you pull them out, you were up 30.7%. And there were three stocks up right at 100%. I do think things are changing. You can see that in the next table!
Here is a listing of every portfolio I have tracked:
| Average of Percent Change | ||
| Date | Total | IWV |
| 16.0% | 10.9% | |
| 21.2% | 14.6% | |
| 13.0% | 9.6% | |
| 10.3% | 12.1% | |
| 20.4% | 18.6% | |
| 29.2% | 23.3% | |
| 22.4% | 20.0% | |
| 19.7% | 17.3% | |
| 13.0% | 13.3% | |
| 12.7% | 14.6% | |
| 10.3% | 12.0% | |
| -0.3% | 4.8% | |
| 12/28/2006 | -6.9% | 3.4% |
| 1/26/2007 | -10.2% | -6.6% |
| 2/27/2007 | -3.7% | -1.0% |
| 3/26/2007 | -9.8% | -5.5% |
| 4/27/2007 | -10.9% | -5.0% |
| 5/29/2007 | -11.5% | -6.3% |
| 7/3/2007 | -30.0% | -15.6% |
| 7/30/2007 | -19.9% | -11.5% |
| 8/30/2007 | -12.5% | -8.7% |
| 9/27/2007 | -19.0% | -18.2% |
| 11/2/2007 | -40.4% | -34.3% |
| 11/28/2007 | -40.1% | -38.3% |
| 12/28/2007 | -36.3% | -40.0% |
| 1/25/2008 | -36.4% | -35.9% |
| 2/26/2008 | -51.7% | -41.5% |
| 3/24/2008 | -40.9% | -36.8% |
| 4/25/2008 | -25.6% | -31.0% |
| 5/28/2008 | -22.2% | -33.6% |
| 7/2/2008 | -11.7% | -25.3% |
| 7/29/2008 | -10.5% | -20.9% |
| 8/29/2008 | -13.8% | -17.9% |
| 9/26/2008 | -4.3% | -10.0% |
| 10/31/2008 | 18.7% | 13.9% |
| 11/26/2008 | 50.9% | 27.7% |
| 12/26/2008 | 48.9% | 32.3% |
| 1/23/2009 | 59.3% | 36.4% |
| 2/27/2009 | 92.8% | 55.6% |
| 3/27/2009 | 85.8% | 48.1% |
| 4/24/2009 | 69.7% | 45.8% |
| 5/29/2009 | 31.8% | 22.8% |
| 6/29/2009 | 21.3% | 24.0% |
| 7/29/2009 | 19.5% | 15.9% |
| 8/28/2009 | 7.4% | 8.8% |
| 9/25/2009 | 12.6% | 12.4% |
| 10/30/2009 | 22.7% | 18.3% |
| 11/27/2009 | 24.3% | 13.6% |
| 23.7% | 18.1% | |
| 19.0% | 20.6% | |
| 18.6% | 23.6% | |
| 10.0% | 15.4% | |
| 7.1% | 11.4% | |
| 19.3% | 25.4% | |
| 16.7% | 25.7% | |
| 5.4% | 20.1% | |
| 7.3% | 10.1% | |
| -4.3% | 0.3% | |
| -2.9% | 10.4% | |
| -8.5% | 1.4% | |
| -11.4% | 0.1% | |
| -7.6% | 4.9% | |
| -5.5% | 5.0% | |
| -4.4% | 7.4% | |
| -16.0% | 3.2% | |
| -12.0% | -0.4% | |
| -9.5% | 5.0% | |
| -4.3% | 8.1% | |
| 12.0% | 21.6% | |
| 23.5% | 29.6% | |
| 10/28/2011 | 0.4% | 11.5% |
| 11/25/2011 | 13.9% | 24.0% |
| 9.9% | 15.9% | |
| 7.4% | 16.6% | |
| 7.8% | 13.3% | |
| 9.1% | 15.2% | |
| 10.5% | 15.3% | |
| 26.5% | 27.5% | |
| 27.5% | 26.3% | |
| 22.9% | 21.5% | |
| 20.1% | 19.1% | |
| 23.4% | 16.4% | |
| 25.2% | 18.5% | |
| 21.0% | 18.3% | |
| 20.0% | 15.9% | |
| 12.1% | 9.7% | |
| 14.6% | 8.6% | |
| 10.7% | 5.0% | |
| 8.4% | 4.4% |
You will note the sad fact that this is the 29th straight portfolio to lose (that is hard to do... it ain't random). However ALL 11 open portfolios are leading the Russell 3000 (by an average of almost 4 points). This is the first time I have seen this in centuries. Ok, that isn't true, but it feels like centuries!
Subsets
I also keep 2 subsets of the larger portfolios: (1) dividend stocks (those with a yield per Yahoo of at least 2.6%) and (2) new stocks (those new to the tracking portfolios in past 12 months. The dividend portfolio was most excellent, up about 34.7%. The new portfolio was solid okay, up 13.5%. Finally, I like to track cash as it is more "honest" than percentages as if you go up by 25% and then down by 25%, that is a different result than up by 5% then down by 5%. So I track what you would have to day if you had spread $100,000 over the first twelve portfolios evenly.
| Category | Value |
| Total | 138,221 |
| Total New | 141,218 |
| Total Dividend | 311,848 |
| Total Russell 3K | 147,147 |
Here are the dividend stocks and the new stocks from a year ago:
| Stock | Initial Price | End Price | Percent Change | Yield |
| 14.54 | 29.19 | 100.8% | 4.8% | |
| 3.56 | 6.40 | 79.8% | 11.2% | |
| 23.47 | 40.49 | 72.5% | 3.5% | |
| 22.19 | 38.20 | 72.1% | 4.5% | |
| 5.95 | 8.37 | 40.7% | 10.1% | |
| 47.93 | 66.73 | 39.2% | 3.7% | |
| 21.46 | 27.49 | 28.1% | 2.9% | |
| 44.74 | 54.67 | 22.2% | 3.1% | |
| 28.20 | 34.27 | 21.5% | 2.7% | |
| USMO | 12.15 | 13.83 | 13.8% | 8.2% |
| INTX | 10.15 | 9.91 | -2.4% | 7.9% |
| 86.28 | 56.24 | -34.8% | 4.6% |
I don't know about you, but those are some pretty stellar results! 37.8% on average. I should have had more faith and been picking more from this group.
| Stock | Initial Price | End Price | Percent Change |
| 1.23 | 2.81 | 128% | |
| INTX | 10.15 | 9.91 | -2% |
| EXPR | 18.72 | 19.20 | 3% |
| ACUR | 3.05 | 2.37 | -22% |
The "New" approach, just does not seem to be getting traction. But the dividend approach, $100k to $311k since January 2006... that is extremely solid. And it is not like it is slowing down, the 11 open dividend portfolios are up an average of almost 24% (versus the broader index at almost 15%.).
I will post more later this Memorial Day Weekend.
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