Ran a scan earlier in the week in hopes to find individual value stocks to buy and hold. Smallish exposure, goal is to have 25% of portfolio these picks and the other 75% VOO.
Scan criteria is as follows:
Reasonable share price vs book value (except MU, I’m willing to pay a higher ratio here for tech)
Must haves:
Current EPS growth higher than 5 yr avg
Positive P/E
Current revenue growth higher than 5 yr avg
Return on equity growth higher than 5 yr avg
Here are the companies I’ve chosen so far:
NBN - financial exposure with strong recent earnings growth and relatively low p/e compared to industry average.
OHI - real estate exposure with strong EPS, Revenue, and ROE growth while staying at 5 yr P/E avg. I also firmly believe long term care will continue to have strong demand in the future.
MU - tech exposure with absurd EPS, Revenue, and ROE growth. Current P/E of 27x is only about 2 times its 5 yr avg and is significantly lower than the industry average of 37-47x. I believe RAM is the bottleneck for AI development at the moment and MU is set up to benefit greatly as I believe it’s undervalued significantly.
UHS - healthcare exposure, good earnings growth, low p/e. I think there’s still a stigma in the United States about mental health currently and opinions will change as people realize how important it is.
I’m looking to add an Energy and Materials pick to this list in the near future. Let me know what you think!