2019 In Review

2019 In Review

Happy New Year to any followers still out there.  As you may have guessed, for the time being I have pretty much tossed in the towel on MFI.  I mean it just isn't working very well.

At some point I may start again.  I am old enough to remember 20 years ago when we had the dot com boom and everyone and their brother/sister was buying the "new" economy stocks and everyone was selling/bashing the "old"economy stocks.  Then we had the dot com bust and value/old economy stocks were suddenly back in vogue.

It feels to me very similar today ("It's Different This Time" can be a very dangerous phrase) with the "disruptors" and social media stocks, many not having business models that make a dime being bid to the moon.  So I have moved a large chunk of cash to the sidelines.  If I see a crash in the "disruptors", I will start nibbling at value stocks again.  But I at least owe my gentle readers a little tidy up on 2019.

2019 MFI Portfolios

While I largely sold my positions in May, I can certainly tell you how they would have done if I had held.  As readers may recall, I had two components, MFI Select and MFI Formula.  I'll show them in two ways: (1) assume I sold the stocks at the anniversary date and (2) assume I held stocks for all of 2019.

MFI Select

First, as a reminder,I had closed two MFI select tranches in 2019:

2/1/2018	Start	Current	Dividend	Pct Gain	R3K Gain
AGX	$43.55	$42.29	$1.00	-0.6%	-2.4%
CASA	$18.81	$11.64	$0.00	-38.1%	-2.4%
KLAC	$109.80	$106.57	$2.84	-0.4%	-2.4%
THO	$136.33	$65.11	$1.52	-51.1%	-2.4%
WDC	$87.74	$44.99	$2.00	-46.4%	-2.4%
Totals				-27.3%	-2.4%
5/2/2018	Start	Current	Dividend	Pct Gain	R3K Gain
CAAP	$12.19	$7.61	$0.00	-37.6%	12.1%
TGNA	$10.51	$15.83	$0.28	53.3%	12.1%
DISCA	$23.85	$30.89	$0.00	29.5%	12.1%
FTSI	$19.39	$10.25	$0.00	-47.1%	12.1%
ICHR	$21.96	$25.04	$0.00	14.0%	12.1%
Totals				2.4%	12.1%

Neither one was all that great.

Here are the open 4 tranches assuming I held them all year:

8/15/2018	Start	Current	Dividend	Pct Gain	R3K Gain
AGX	$39.45	$40.14	$1.25	4.9%	12.9%
AMCX	$60.97	$39.50	$0.00	-35.2%	12.9%
CJREF	$3.08	$4.09	$0.12	36.8%	12.9%
GME	$15.50	$6.08	$1.14	-53.4%	12.9%
SGH	$31.12	$37.94	$0.00	21.9%	12.9%
Totals				-5.0%	12.9%
11/15/2018	Start	Current	Dividend	Pct Gain	R3K Gain
AGX	$43.15	$40.14	$1.00	-4.7%	19.8%
DXC	$62.00	$37.59	$0.38	-38.8%	19.8%
MU	$38.49	$53.78	$8.25	61.2%	19.8%
SGH	$29.67	$37.94	$0.00	27.9%	19.8%
WDC	$44.92	$63.47	$2.00	45.7%	19.8%
Totals				18.3%	19.8%
2/1/2019	Start	Current	Dividend	Pct Gain	R3K Gain
AGX	$42.18	$40.14	$0.75	-3.1%	18.7%
BBY	$58.84	$87.80	$0.50	50.1%	18.7%
HPQ	$22.07	$20.55	$0.16	-6.1%	18.7%
MU	$38.22	$53.78	$0.00	40.7%	18.7%
RTN	$166.65	$181.41	$0.94	9.4%	18.7%
VIAB	$29.40	$24.22	$0.40	-16.3%	18.7%
WDC	$44.99	$63.47	$1.00	43.3%	18.7%
Totals				16.9%	18.7%
5/2/2019	Start	Current	Dividend	Pct Gain	R3K Gain
FTSI	$10.25	$1.04	$0.00	-89.9%	10.2%
DXC	$64.74	$37.59	$0.38	-41.4%	10.2%
KHC	$31.84	$32.13	$0.80	3.4%	10.2%
MO	$53.26	$49.91	$1.68	-3.1%	10.2%
EAF	$11.34	$11.62	$0.13	3.6%	10.2%
TGNA	$15.83	$14.77	$0.14	-5.8%	10.2%
Totals				-22.2%	10.2%

Two absolute train wrecks with May and August.  I've been a bit lazy on the dividends,so these aren't exactly right, but you get the gist.  Then here are the two tranches assuming I had closed the first two in August and November:

8/15/2018	Start	Current	Dividend	Pct Gain	R3K Gain
AGX	$39.45	$39.33	$1.25	2.9%	-5.7%
AMCX	$60.97	$49.58	$0.00	-18.7%	-5.7%
CJREF	$3.08	$3.73	$0.12	25.1%	-5.7%
GME	$15.50	$3.21	$1.14	-71.9%	-5.7%
SGH	$31.12	$27.77	$0.00	-10.8%	-5.7%
Totals				-14.7%	-5.7%
11/15/2018	Start	Current	Dividend	Pct Gain	R3K Gain
AGX	$43.15	$40.14	$1.00	-4.7%	15.1%
DXC	$62.00	$37.59	$0.38	-38.8%	15.1%
MU	$38.49	$53.78	$8.25	61.2%	15.1%
SGH	$29.67	$37.94	$0.00	27.9%	15.1%
WDC	$44.92	$63.47	$2.00	45.7%	15.1%
Totals				18.3%	15.1%

Pretty much same story,one small win and a ten point loss.

MFI Formula

Same steps with MFI Formula tranches.First a reminder of how the two most recently closed tranches before I stopped blogging:

1/2/2018	Start	Current	Dividend	Pct Gain	R3K Gain
AMGN	$177.11	$192.47	$5.28	11.7%	-7.2%
GME	$18.06	$12.56	$1.52	-22.0%	-7.2%
GILD	$71.64	$62.01	$2.28	-10.3%	-7.2%
HRB	$26.34	$25.05	$0.99	-1.1%	-7.2%
OMC	$72.81	$72.74	$1.80	2.4%	-7.2%
Totals				-3.9%	-7.2%
4/3/2018	Start	Current	Dividend	Pct Gain	R3K Gain
AMGN	$166.46	$189.90	$5.28	17.3%	10.6%
VIAB	$29.20	$28.07	$0.80	-1.1%	10.6%
GILD	$72.71	$65.01	$2.34	-7.4%	10.6%
TUP	$47.32	$25.58	$2.31	-41.1%	10.6%
EGOV	$13.29	$17.09	$0.32	31.0%	10.6%
Totals				-0.3%	10.6%

Then here are the 4 open tranches at that time assuming I held all through 2019:

7/2/2018	Start	Current	Dividend	Pct Gain	R3K Gain
CJREF	$3.90	$4.09	$0.31	12.8%	18.2%
GILD	$70.80	$64.98	$1.77	-5.7%	18.2%
IPG	$22.80	$23.10	$0.66	4.2%	18.2%
KLAC	$102.03	$178.17	$3.00	77.6%	18.2%
TUP	$40.09	$8.58	$2.17	-73.2%	18.2%
Totals				3.1%	18.2%
10/2/2018	Start	Current	Dividend	Pct Gain	R3K Gain
CJREF	$3.36	$4.09	$0.12	25.3%	10.3%
GILD	$78.13	$64.98	$1.20	-15.3%	10.3%
IPG	$22.80	$23.10	$0.45	3.3%	10.3%
PETS	$31.56	$23.52	$1.35	-21.2%	10.3%
VIAB	$32.21	$24.22	$0.40	-23.6%	10.3%
Totals				-6.3%	10.3%
1/2/2019	Start	Current	Dividend	Pct Gain	R3K Gain
EGOV	$12.54	$22.35	$0.08	78.9%	30.3%
GILD	$62.01	$64.98	$0.63	5.8%	30.3%
IPG	$20.50	$23.10	$0.24	13.8%	30.3%
KLAC	$90.04	$178.17	$1.50	99.5%	30.3%
OMC	$72.74	$81.02	$0.65	12.3%	30.3%
Totals				42.1%	30.3%
4/1/2019	Start	Current	Dividend	Pct Gain	R3K Gain
VIAB	$28.90	$24.22	$0.20	-15.5%	11.9%
DLX	$44.50	$49.92	$0.60	13.5%	11.9%
HRB	$24.31	$23.48	$0.00	-3.4%	11.9%
GILD	$66.00	$64.98	$0.00	-1.5%	11.9%
KLAC	$122.10	$178.17	$0.75	46.5%	11.9%
Totals				7.9%	11.9%

Again, I'm lazy with dividends (both for Russell 3000 and my stocks), but directionally it makes little difference.  Three of the four tranches were losers.  Overall lost by an average of 6 points.

Then here are tranches if I had closed them on schedule (again only show first two as newest two would still be open):

7/2/2018	Start	Current	Dividend	Pct Gain	R3K Gain
CJREF	$3.90	$4.70	$0.31	28.5%	7.7%
GILD	$70.80	$68.84	$1.77	-0.3%	7.7%
IPG	$22.80	$23.20	$0.66	4.6%	7.7%
KLAC	$102.03	$119.63	$3.00	20.2%	7.7%
TUP	$40.09	$18.42	$2.17	-48.6%	7.7%
Totals				0.9%	7.7%
10/2/2018	Start	Current	Dividend	Pct Gain	R3K Gain
CJREF	$3.36	$3.97	$0.12	21.7%	-2.1%
GILD	$78.13	$61.62	$1.20	-19.6%	-2.1%
IPG	$22.80	$20.52	$0.45	-8.0%	-2.1%
PETS	$31.56	$18.09	$1.35	-38.4%	-2.1%
VIAB	$32.21	$23.01	$0.40	-27.3%	-2.1%
Totals				-14.3%	-2.1%

Yeah, I know.  Doesn't change much.  Too many stinkers (stocks down by 30% or more... what MFI Formula was trying to weed out).

Baker's Dirty Dozen

To continue my tidy-up, I did post last December a listing of 13 stocks that (many MFI) that I felt were super cheap.  Here is how they did for a year (I closed them December 17th as I was going on vacation):

Stock	Start	Current	Dividend	Gain/Loss
AMAT	30.31	61.61	0.84	106.0%
AMCX	52.23	38.89	-	-25.5%
DLX	37.11	50.09	1.20	38.2%
DXC	50.48	37.50	0.76	-24.2%
ECA	5.38	4.43	0.08	-16.2%
GLNG	21.72	13.54	0.30	-36.3%
KLAC	85.67	176.07	3.05	109.1%
LRCX	127.16	295.58	2.20	134.2%
MU	30.32	55.27	-	82.3%
SGH	28.75	35.88	-	24.8%
T	28.31	38.99	2.04	44.9%
TGP	11.82	15.79	0.66	39.2%
WDC	35.90	59.87	2.00	72.3%
Total				42.2%

So they were great, up by 42% on average.  When I closed it,  I did start a new Baker's Dirty Dozen.  It is off to a good start:

Ticker	12/17/2019	Current	YTD Change	Dividend
MO	50.88	49.72	-0.6%	0.84
AXS	60.52	59.44	-1.1%	0.44
MPLX	25.48	25.41	-0.3%	-
CPLP	12.03	13.46	11.9%	-
MAC	25.91	26.92	3.9%	-
CHL	39.89	42.28	6.0%	-
CSCO	46.40	47.83	3.1%	-
OXY	38.34	40.82	6.5%	-
HT	14.19	14.63	3.1%	-
HI	33.25	33.51	0.8%	-
NTR	48.53	47.82	-0.5%	0.45
AROC	9.38	9.94	5.9%	-
ECA	4.45	4.69	5.4%	-
			3.4%

12/31/19 MFI Tracking Portfolio

My readers may recall I also have had MFI tracking portfolios (50 stocks over $$100m) that I have been tracking since 2006.  Here is how the December 31st 2019 portfolio fared:

Stock	Initial Price	End Price	Percent Change	Mkt Cap
VEC	21.58	51.26	137.5%	243
LRCX	133.31	292.40	119.3%	21,848
KLAC	87.34	178.17	104.0%	13,699
AMAT	32.15	61.04	89.9%	31,594
EGOV	12.27	22.35	82.2%	818
WDC	35.83	63.47	77.1%	10,684
CELG	64.09	110.02	71.7%	44,793
AEIS	42.93	71.20	65.9%	1,662
STX	36.70	59.50	62.1%	11,042
CECO	11.42	18.39	61.0%	797
AKG	0.64	0.95	48.4%	144
SP	29.54	42.43	43.6%	662
DLX	37.45	49.92	33.3%	1,780
STRL	10.89	14.08	29.3%	295
CJREF	3.32	4.09	23.0%	742
IPG	19.75	23.10	17.0%	7,929
IDT	6.19	7.21	16.5%	147
OMC	70.84	81.02	14.4%	16,464
MSB	20.95	23.54	12.3%	311
ALSN	43.34	48.32	11.5%	5,692
AGX	36.96	40.14	8.6%	589
GILD	60.23	64.98	7.9%	81,065
PETS	22.08	23.52	6.5%	481
HSII	30.62	32.50	6.1%	591
EAF	11.13	11.62	4.4%	3,324
HPQ	19.78	20.55	3.9%	31,836
UIS	11.63	11.86	2.0%	593
ESIO	29.96	30.00	0.1%	1,040
HRB	24.34	23.48	-3.5%	5,214
VIAB	25.15	24.22	-3.7%	10,360
MCFT	18.70	15.75	-15.8%	350
IDCC	64.95	54.49	-16.1%	2,302
IMMR	8.96	7.43	-17.1%	276
TVTY	24.81	20.35	-18.0%	994
INVA	17.45	14.16	-18.9%	1,979
UTHR	108.90	88.08	-19.1%	5,122
MSGN	23.56	17.40	-26.1%	1,763
DXC	52.14	37.59	-27.9%	14,956
HEAR	14.27	9.45	-33.8%	203
NKTR	32.87	21.59	-34.3%	5,688
SIGA	7.90	4.77	-39.6%	635
GME	12.21	6.08	-50.2%	1,290
LTRPA	15.89	7.35	-53.7%	1,193
LGORF	2.07	0.77	-62.8%	1,084
BPT	19.01	6.88	-63.8%	463
NHTC	17.15	5.38	-68.6%	210
TUP	30.31	8.58	-71.7%	1,534
FTSI	7.11	1.04	-85.4%	777
ACOR	15.58	2.04	-86.9%	735
TUSK	17.73	2.20	-87.6%	805

I always preached how you have to minimize the number of stinkers (stocks dropping 30% or more).  Historically it is about 14% of all MFI stocks.  Here it is a putrid 24%... in a year where the Russell 3000 was up over 30%!  So MFI tracking was trounced 5% to 31%.

The three other portfolios I started for tracking in 2019 are also trailing by 15 points plus.  It is like MFI is working in reverse, which is why I commented this feels like 1999-2000 when money was flowing away from old economy stocks into sexy dot coms.

Large Caps

I also did some modest tracking of large cap (over $3b) MFI stocks in 2019.  Pretty similar story.

Ticker	Shares	Basis	Current Price	Pct Change
AAPL	11.93	167.67	293.65	75.1%
ALSN	41.17	48.58	48.32	-0.5%
AMAT	50.57	39.55	61.04	54.3%
AMCX	32.60	61.35	39.50	-35.6%
AMGN	10.71	186.69	241.07	29.1%
AYI	16.48	121.34	138.00	13.7%
BBY	34.31	58.30	87.80	50.6%
CAH	41.15	48.60	50.58	4.1%
CBS	40.51	49.37	41.97	-15.0%
CC	55.43	36.08	18.09	-49.9%
CDK	40.97	48.82	54.68	12.0%
CPRI	47.03	42.53	38.15	-10.3%
CVS	30.92	64.68	74.29	14.9%
DNB	13.82	144.77	144.95	0.1%
DXC	30.78	64.98	37.59	-42.2%
EAF	149.59	13.37	11.62	-13.1%
EME	30.60	65.35	86.30	32.1%
FFIV	12.42	161.09	139.65	-13.3%
GILD	28.65	69.81	64.98	-6.9%
GNTX	95.10	21.03	28.98	37.8%
HPQ	90.87	22.01	20.55	-6.6%
HRB	84.85	23.57	23.48	-0.4%
IPG	88.26	22.66	23.10	1.9%
JAZZ	15.86	126.11	149.28	18.4%
JEC	30.85	64.84	85.84	32.4%
KLAC	18.69	107.03	178.17	66.5%
LB	72.23	27.69	18.12	-34.6%
LEA	12.98	154.04	137.20	-10.9%
LPX	81.53	24.53	29.67	21.0%
LRCX	11.66	171.46	292.40	70.5%
MAN	25.53	78.33	97.10	24.0%
MAS	60.28	33.18	47.99	44.6%
MCK	16.03	124.79	138.32	10.8%
MD	55.36	36.13	27.79	-23.1%
MKSI	24.03	83.23	110.01	32.2%
MO	40.50	49.38	49.91	1.1%
MU	51.24	39.03	53.78	37.8%
NKTR	47.03	42.53	21.59	-49.2%
OMC	25.66	77.94	81.02	4.0%
PM	26.34	75.92	85.09	12.1%
RTN	11.86	168.67	219.74	30.3%
STLD	54.54	36.67	34.04	-7.2%
STX	44.55	44.89	59.50	32.5%
SWKS	27.21	73.49	120.88	64.5%
TER	54.69	36.57	68.19	86.5%
TNET	42.77	46.76	56.61	21.1%
UTHR	17.39	115.03	88.08	-23.4%
VIAB	68.49	29.20	24.22	-17.1%
WDC	43.99	45.46	63.47	39.6%
XRX	70.37	28.42	36.87	29.7%

So on average up 11%, but benchmark up over 20%.  Let's look at one more.

March 1st:

Ticker	Shares	Basis	Current Price	Gain/Loss	Pct G/L
AAPL	11.43	174.97	293.65	1,357	67.8%
ABC	24.10	82.98	85.02	49	2.5%
ALSN	40.87	48.94	48.32	(25)	-1.3%
AMAT	51.87	38.56	61.04	1,166	58.3%
AMGN	10.46	191.16	241.07	522	26.1%
AYI	15.12	132.28	138.00	86	4.3%
BBY	29.49	67.81	87.80	590	29.5%
BIIB	5.99	334.10	296.73	(224)	-11.2%
CBS	39.38	50.79	41.97	(347)	-17.4%
CDK	34.03	58.78	54.68	(140)	-7.0%
CELG	23.27	85.96	108.24	518	25.9%
CLF	183.65	10.89	8.40	(457)	-22.9%
CPRI	42.73	46.81	38.15	(370)	-18.5%
CTSH	27.73	72.13	62.02	(280)	-14.0%
DXC	29.73	67.27	37.59	(882)	-44.1%
EAF	140.55	14.23	11.62	(367)	-18.3%
EME	27.58	72.51	86.30	380	19.0%
FFIV	12.01	166.53	139.65	(323)	-16.1%
GILD	30.30	66.01	64.98	(31)	-1.6%
GNTX	97.56	20.50	28.98	827	41.4%
HPQ	102.04	19.60	20.55	97	4.8%
HRB	82.85	24.14	23.48	(55)	-2.7%
IPG	86.47	23.13	23.10	(3)	-0.1%
JAZZ	14.39	138.98	149.28	148	7.4%
KHC	61.73	32.40	32.13	(17)	-0.8%
KLAC	17.27	115.78	178.17	1,078	53.9%
LEA	13.10	152.68	137.20	(203)	-10.1%
LPX	78.52	25.47	29.67	330	16.5%
LRCX	11.32	176.75	292.40	1,309	65.4%
MAN	23.67	84.51	97.10	298	14.9%
MAS	50.00	40.00	47.99	400	20.0%
MCK	16.06	124.53	138.32	221	11.1%
MKSI	23.85	83.85	110.01	624	31.2%
MO	37.91	52.75	49.91	(108)	-5.4%
MU	48.10	41.58	53.78	587	29.3%
NCR	70.03	28.56	35.16	462	23.1%
NKTR	52.45	38.13	21.59	(868)	-43.4%
NTAP	30.20	66.22	62.25	(120)	-6.0%
NUS	33.75	59.26	40.98	(617)	-30.8%
OMC	26.07	76.72	81.02	112	5.6%
RHI	29.33	68.20	63.15	(148)	-7.4%
RTN	10.74	186.19	219.74	360	18.0%
STX	43.15	46.35	59.50	567	28.4%
SWKS	24.40	81.98	120.88	949	47.5%
TGNA	133.78	14.95	16.69	233	11.6%
TPR	56.56	35.36	26.97	(475)	-23.7%
UTHR	15.77	126.84	88.08	(611)	-30.6%
VIAB	67.91	29.45	24.22	(355)	-17.8%
WDC	38.71	51.66	63.47	457	22.9%
XRX	63.92	31.29	36.87	357	17.8%

  

So on average +7%.   While the Russell 3000 was up 16%.  I know, frustrating.  I think irregardless of how you slice it 2019 was poor for MFI(GARIX, a MFI mutual fund was up about 12%, again vs an index up 30%).

MFI Diary Motley Fool

I also started in 2019 a CAPS portfolio called MFI Diary on Motley Fool that randomly picks about 7 stocks once a quarter.  You can see the results here, not so hot:

Going Forward

I will set up two tracking portfolios for 2020 and perhaps follow up a few times here.  Have a great year everyone!