MFI has had some dry spells in the past, but it is really being tested of late. All I know is that if it is supposed to outperform, we have some very good days ahead. Cause it is not a pretty picture right now.
Here are the 12 open portfolios. The first figure is MFI return. The second is Russell 3000.
All twelve are losing - by a wide margin. In the past 23 tranches, including the 12 shown here, MFI has won a single time.
The easy answer might be that value stocks generally are struggling. A key assumption of MFI is that the income a company made the past 12 months is a good proxy for the upcoming year. There are times and stocks for which that is a poor assumption. Look at the worst performers of the Feb 2015 tranche:
|Stock||Initial Price||End Price||Percent Change|
- MSB had $24m of Op Income year ending Jan 2015. The past three quarters: $5.8.
- APOL had $249 TTM op income last February. Now it is $9.2m.Whoa.
- EGL Did not drop off much - but guidance given in January this year caused a one day drop of 41%.
- TPUB has dropped Op Inc from $86m to $50m. And it is falling rapidly.
I could go on. But you get the picture.