MFI Formula Tranche - October 2016/17

MFI Formula Tranche - October 2016/17

Well, we are in full fall mode here in New Hampshire.  Tomorrow, we head back to Southern New England... maybe get a pumpkin donut for the road!

With the end of the 3rd quarter nearing, it is time for me to start prepping for a new MFI tranche, this time in my "formula" money.  Honestly, there is no "prepping" to do, as my formula money, is just that... formula-driven.  And while the formula approach has been pretty tepid since I started with real $ 3 years ago, I will be patient. As a reminder, the formula is essentially

1. Run official MFI screen, top 50 over $100m.
2. Pare that down to top 34 stocks by market cap
3. Pare (2) down to stocks with 2.4% yield or greater.
4. I can then throw out one name.
5. Randomly select 5 stocks from (4).

Here is the tranche running into it's final three weeks:

10/3/2016	Start	Current	Dividend	Pct Gain	R3K Gain
CPLA	$58.15	$66.35	$1.64	16.9%	15.6%
LDOS	$43.01	$57.70	$0.96	36.4%	15.6%
GME	$27.70	$18.85	$1.51	-26.5%	15.6%
PBI	$18.15	$12.63	$0.75	-26.3%	15.6%
CSCO	$31.72	$31.76	$1.10	3.6%	15.6%
Totals				0.8%	15.6%

Yeah, not exactly "woo-hoo" material.  Actually, an all-around stomping.  CPLA really has fallen off, it was $85 a quarter ago.  And I don't need to tell regular readers that GME just always seems to go down.  As the saying goes, "Bulls of GME and their money will eventually be separated".

Looking at historical data, the 4 stocks that did not get picked by randomness have basically been flat (similar to my picked stocks).  The 5 stocks that ran off from 10/1/15 were also under-whelming.

All-in-all, a poor performance for all things MFI Formula in past 12 months.  But still, I persevere. The hate for Value stocks will diminish.  I did read an interesting thought, by definition, buying value stocks requires you to be contrarian.   They are a "value" often because they are out of favor.

Here are the stocks that I show would qualify per my screens above were I to pick today:

Ticker	Market Cap	Price	Dividend	Yield
HRB	5,435	25.69	0.96	3.7%
CPLA	773	66.35	1.64	2.5%
CSCO	158,075	31.76	1.16	3.7%
CJREF	2,317	11.35	0.87	7.7%
GME	1,959	18.85	1.52	8.1%
GILD	108,333	85.47	2.08	2.4%
KLAC	14,821	95.32	2.36	2.5%
OMC	16,886	72.47	2.20	3.0%
RGR	827	47.70	1.56	3.3%
VIAB	11,356	27.20	0.80	2.9%

Would I choose to kick out any of these?  GME is so tempting.  Interesting BKE has fallen off list - I assume that is temporary due to recent earnings or something.  I suspect I will just let it ride and have Mr Random pick my 5 names.