Initial Thoughts About 2/1 MFI Select Tranche

Initial Thoughts About 2/1 MFI Select Tranche

Well, it is -3 out there on this New Year morning.  Not going to start my running resolution when it is this cold!  So I have fixed up my spreadsheets for the new year and thought I'd write a quick post.

I have already commented on my MFI Formula tranche I will be buying tomorrow.  That means I have a month to laser focus on my February 1st tranche for MFI Select.  Obviously, my Select tranches require more time and research as I pick the stocks as opposed to a formula.  First a quick peek at the tranche with a month left to go:

2/1/2017	Start	Current	Dividend	Pct Gain	R3K Gain
AKRX	$19.10	$32.23	$0.00	68.7%	18.7%
YY	$41.08	$113.06	$0.00	175.2%	18.7%
KLAC	$85.11	$105.07	$2.26	26.1%	18.7%
WNC	$17.65	$21.70	$0.18	24.0%	18.7%
RGR	$52.75	$55.85	$1.36	8.5%	18.7%
Totals				60.5%	18.7%

That is a memorable tranche.  Hopefully no wheels fall off in next 4+ weeks!  AKRX is being bought by a German company.  YY has simply been one of my best MFI picks ever (it was so cheap a year ago).

Now recall I posted some themes that I felt were important in 2018.  First I do believe tax reform will have a more positive impact everywhere than people are saying.  Be it the consumer with the wealth effect or businesses.  Second, now that the uncertainty of tax reform is behind us, I expect a flurry of M&A activity.  And that is where MFI stocks can shine as they are often accretive to the buyers.  Finally, with my reading of the Acquirer's Multiple, I have a new appreciation for losers.

Looking at the official list now.  Here are some names worthy of research in my view:

AMCX (hey, just watching some of Breaking Bad marathon last night!).

AGX - acting like another new power plant will not be built (this is a candidate to be bought)

CASA - never heard of them An IPO from early January, has already gone from $13 to $17.

EGRX - pharmaceuticals are so hated

KLAC - could just keep them another year.

MPAA - no one seems to value auto parts.

NHTC - I know, they may be a scam. But cheap and hated.

PBI - so cheap, so hated.

SP - the fact that they make the screen does indicate market is extended.  But they look ok.

SYNT - sell off seems overdone.

TVTY - healthcare space might make sense.

Then a few miscellaneous ideas:

QIWI

HUM (I know, they are an insurance company. But AET/CVS may spur more activity)

TOSYY (don't go for ADRs often, but Toshiba looks cheap)

MOMO - a smaller counterpart to YY.

JMEI - need to convince me they are not a Chinese scam.  But insanely cheap.

TWX - might be short lived, in cross hair of Justice department scrutiny. But with FOX getting bought, an interesting idea.

FUJHY - who doesn't like their Subaru?

Ok, enough rambling.  I will run further screen the last week of January to see if anything looks good/better.