The Panelists. June 23, /23/2015. Ken Kavula President Mid-Michigan Chapter. Marion Michel Director Silicon Valley Chapter

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1 June 23, 2015 The Panelists Marion Michel Director Silicon Valley Chapter Ken Kavula President Mid-Michigan Chapter Ann Cuneaz Education Program Manager BetterInvesting 2 1

2 Disclaimer The information in this presentation is for educational purposes only and is not intended to be a recommendation to purchase or sell any of the stocks, mutual funds, or other securities that may be referenced. The securities of companies referenced or featured in the seminar materials are for illustrative purposes only and are not to be considered endorsed or recommended for purchase or sale by BetterInvestingTM National Association of Investors Corporation ( BI ). The views expressed are those of the instructors, commentators, guests and participants, as the case may be, and do not necessarily represent those of BetterInvestingTM. Investors should conduct their own review and analysis of any company of interest before making an investment decision. Securities discussed may be held by the instructors in their own personal portfolios or in those of their clients. BI presenters and volunteers are held to a strict code of conduct that precludes benefiting financially from educational presentations or public activities via any BetterInvesting programs, events and/or educational sessions in which they participate. Any violation is strictly prohibited and should be reported to the CEO of BetterInvesting or the Director of Chapter Relations. This presentation may contain images of websites and products or services not endorsed by BetterInvesting. The presenter is not endorsing or promoting the use of these websites, products or services. This session is being recorded for future use. 3 The Program Research Using Standard & Poor s Capital IQ Reports More Research Understanding Value Line s Future Growth Estimates Keep Learning Revitalize Your Club Education Program! Five in Five Stock Ideas to Consider 4 2

3 NEW Webinar Feature Handouts Available in the Control Panel 5 Click the handout link to open the file in your browser. 6 3

4 Handout Access Will Vary by Device Windows and Mac Access through the control panel Android device You will see a Handout icon in your toolbar. Tap the icon to see the Handouts pane. ios device You will see a Handout icon in your toolbar. Tap the icon to see the Handouts pane. This is a new feature, so all the bugs may not be worked out yet! Handouts also at 7 Standard & Poor s Capital IQ* Reports for Individual Investors Presenter: Marion Michel Director, Silicon Valley Chapter marionm@silicon.betterinvesting.net Product used for educational purposes only. Not endorsed by BetterInvesting S&P is a subsidiary of McGraw Hill Financial, Inc. (MHFI/NYSE) 8 4

5 S&P CAPITAL IQ REPORTS Purpose of Presentation To make you aware of S&P research tools Agenda Where to find company reports Types of reports: Star, Quantitative, Factual Star ranking system What I like best about S&P Basic 2 page company report Other key S&P company information Industry surveys 9 WHERE to FIND S&P Capital IQ REPORTS You need a little luck It s worth the effort to try to find them STAR REPORTS PAPER COMPANY REPORT ONLINE COMPANY REPORT ONLINE INDUSTRY SURVEY BI CLUB CONTACT* 2pages SOME LIBRARIES 2pages 6+pages 50 to 70+ pages SOME DISCOUNT 6+ pages pages BROKERS Charles Schwab TD Ameritrade E Trade Fidelity Fidelity and maybe Scottrade others There may be others * Selected companies quarterly good club education opportunity 10 5

TYPES OF S&P IQ CAPITAL REPORTS Companies Star Reports BUY/HOLD/SELL recommendations, full analysis Quantitative Reports no recommendation, other analysis Factual Reports no recommendation or

parts of the NetAdvantage package They may get company reports but not industry surveys Discount brokers are more likely to offer company reports than both company reports and industry surveys If a

6 TYPES OF S&P IQ CAPITAL REPORTS Companies Star Reports BUY/HOLD/SELL recommendations, full analysis Quantitative Reports no recommendation, other analysis Factual Reports no recommendation or analysis Industries Industry Surveys full industry analysis w/statistical details about companies Notes NetAdvantage is the S&P service package for libraries Libraries may subscribe to all or just parts of the NetAdvantage package They may get company reports but not industry surveys Discount brokers are more likely to offer company reports than both company reports and industry surveys If a library or broker has star company reports, they will also have the quantitative and other company reports 11 S&P BUY/HOLD/SELL Star Recommendations on Companies Compare VL Timeliness/1=most timely Mstar/5* = most undervalued *NOTE: Mstar s rating compares price to intrinsic value, not the market 12 6

WHAT I LIKE BEST ABOUT S&P and NetAdvantage Company Reports (Basic 2 page report) Paper or Online Quick sniff test material at top of page 1 Chart has extra features Analysts clearly address key

7 WHAT I LIKE BEST ABOUT S&P and NetAdvantage Company Reports (Basic 2 page report) Paper or Online Quick sniff test material at top of page 1 Chart has extra features Analysts clearly address key points in S&P methodology (star reports) Company Reports (6 pages) NetAdvantage (Library) or Broker More complete business description (star reports) Peer group with brief statistical comparisons Companies Tab NetAdvantage (Library) Simple screener results download able to Excel How to Analyze This Company Weekly S&P Outlook newsletter with model portfolios Lots of info about S&P Indexes (500, 400, 600) Industries Tab/Choice NetAdvantage (Library) or Broker Easy to match companies to their industry reports Reports explain how to analyze each industry 13 BASIC 2 PAGE S&P COMPANY REPORT Paper and Online Chart, brief narrative, data arrays and more Similar to Value Line & Morningstar 1 Page PDFs Online Page 1 Paper Pg. 1 Online Page 3 Paper Pg

8 KEY FEATURES of BASIC 2 PAGE COMPANY STAR REPORT Read this later Let s take a look at the Clorox Report on May 16, 2015 Top of first page S&P recommendation (at the current price*) 5 stars/buy, 1/sell Current price and 12 month target price Name of analyst Company size (in terms of market cap) & style (growth, value, etc.) Sector/industry One sentence description of business Basic stats, like EPS, yield, PE, institutional ownership $10K invested 5 years ago S&P 3 year projected EPS compound annual growth rate S&P quality ranking * check the date of the current price 15 KEY FEATURES of BASIC 2 PAGE COMPANY STAR REPORT Also on first page Let s take a look 5 year chart showing: Prices & volume 12 month target prices over the 5 year period Earnings direction (up, flat, down) Changes in star rating Date of analysis and price at time of analysis Recent highlights affecting the company S&P investment rationale/risk How the analyst calculated the 12 month price target Analyst s overall risk assessment Quarterly revenue, earnings, dividend data 16 8

9 KEY FEATURES of BASIC 2 PAGE COMPANY STAR REPORT Let s take a look 2 nd page: (in the online version, this is actually the 3 rd page) S&P s Quantitative Evaluations: Fair Value Rank Fair Value Calculation Investability Quotient Percentile Volatility Technical Evaluation Insider Activity Expanded Ratio Analysis Data Arrays: Per Share, Income Statement, Balance Sheet Core Earnings 17 WHAT S on the OTHER 4 PAGES of the ONLINE COMPANY STAR REPORTS? Lots of info on the other pages!!! Page 2 (online version) Business Summary mostly in English Corporate Overview description of products/services Corporate Strategy How is the company planning to grow? Impact of Major Developments Any significant victories or pratfalls? Financial Trends English, not just Financialese Page 4 Sub Industry Outlook for next 12 months list of peer companies w/stats Page 5 Analyst Notes & Company News (Earnings) Explanations of the logic behind star recommendations over past year or so Page 6 Analysts Recommendations & Wall Street Consensus Estimates NOTE: CLOROX Wall Street analysts recommended HOLD on May 16; S&P recommended SELL Let s take a quick look 18 9

10 THE COMPANY SECTION of the NetAdvantage Library Site A Few Other Features We ve been looking at the 6 page online PDF version of an S&P Company Report What else is available about companies in NetAdvantage Explore these when you get a library card Other Features on the Company Tab for a Particular Company Dividends & Stock Splits, Ex Dividend Dates Competitors How to Analyze the Company Link to the Industry Report Other Features on the Company Tab Stock Screener The Outlook Newsletter S&P Indexes Bond Screener Investment Ideas 19 THE INDUSTRY SURVEY the Information POT OF GOLD! INDUSTRY PERFORMANCE Sector Overview Industry Overview Revenues Expenses Profits & Margins Valuation Capital Markets Industry Surveys are LONG because they have TONS of explanations & data INDUSTRY PROFILE Trends How the Industry Operates Key Ratios and Statistics How to Analyze This Industry Glossary Industry References Comparative Company Analysis Let s take a very fast look May you have access to a library or broker with S&P Industry Surveys!! 20 10

11 S&P INDUSTRY REPORT Sample Narrative 21 S&P INDUSTRY REPORT Sample Chart, Data Array 22 11

12 SUGGESTIONS for FINDING LIBRARIES with S&P NetAdvantage Check the online library catalogs of: Cities, counties and even states: Nearby Talk to your local library about subscribing if they don t Ask for the business or reference librarian Where you work Where you have friends/relatives you plan to visit Where you plan to tour or drive through while touring Your alma mater Often public libraries provide free or low cost cards to residents outside their districts. When you find a library with an S&P NetAdvantage subscription, check its policy on how to get a card. Call the library s reference desk to determine if they subscribe to industry reports, as well as company reports. 23 Understanding Value Line s Estimates for Future Growth OR Why do the growth rates found in the Value Line Annual Rates Box seem so different from the future values found in the Value Line Data Grid? 12

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14 Value Line Annual Rates The Starting point for the estimate is based on a 3 year historical average. The starting point may not represent the most recent 3 years. Value Line Annual Rates 14

Internet for a CAGR calculator: http://www.moneychimp.

15 Compound Annual Growth Rate (CAGR) In Excel: ((Ending Value / Beginning Value) ^ (1/# of years)) 1 Or search the Internet for a CAGR calculator: ulator.htm # of Years = = 7 15

16 What is the Growth Rate from the Most Recent Year to the Future Value? Summary Understand the research data you use Don t take any single analyst estimate at face value Make your own forecasts on the SSG based on your reading and analysis of several different resources. 16

17 EDUCATION, EDUCATION, EDUCATION! Ken Kavula President, BI Mid Michigan Chapter June 23, 2015 If you re a realtor, it s LOCATION... If you re a chef, it s INGREDIENTS... If you re an athlete, it s TRAINING... If you re an artist, it s INSPIRATION... And if you belong to an investment club it should be EDUCATION! 17

18 No funny graphics for this presentation. Nothing to distract you from the main idea. The primary purpose of an investment club is to learn about investing. Is your club focused on learning something new each meeting? Making money is a great reason to belong to an investment club but it shouldn t be the primary reason for you to join or to remain a member. You should be learning about investing. If your club has neglected a formal education program, here s a few ideas to get you back on track. 18

19 I see different situations in clubs that I visit and that calls for different educational plans. See if you spot your club on my list: BRAND NEW CLUB WITH NO REAL EXPERIENCE IN INVESTING MORE EXPERIENCED CLUB WITH A FAIR NUMBER OF NEWER MEMBERS MORE EXPERIENCED CLUB WITH MOST MEMBERS FLUENT IN THE LANGUAGE OF THE STOCK SELECTION GUIDE CLUB WITH ONLY ONE OR TWO MEMBERS CREATING AND INTERPRETING STOCK SELECTION GUIDES CLUB THAT DOESN T USE THE STOCK SELECTION GUIDE AT ALL MORE EXPERIENCED CLUB WITH MOST MEMBERS HAZY ABOUT THE SSG I urge you to use some of the free resources available to each of you as members of BetterInvesting! Start listening to snippets of TickerTalk or StockUp as a group. Take ten minutes after you listen to a segment to restate what you learned and discuss questions that might have arisen. Take the Introduction to the SSG series as a group. Make assignments, use the many handouts and hold different people in your club responsible for leading the monthly discussion. Go online and play as a group. Explore and don t be afraid to make mistakes as you look at the SSGPlus, the new Stock Comparison Guide, your accounting site, your brokerage site or maybe some of the free sites available from your public library. 19

20 Be creative and explore things you really want to learn about. Take a few months and read a good investing book as a group become a book club for twenty minutes each meeting! Explore topics that are financially related to investing such as taxes, retirement planning, IRAs and 401 Ks, reverse mortgages, trusts and any other topics that may interest your partners. Keep it interesting and relevant to your members. Take a field trip to your local library and learn about their resources for investing, visit an annual meeting of a local company, arrange to tour or meet with an IR person from a company that you own or might be interested in owning. The ideas should start to flow if you make EDUCATION your top priority in keeping your club vital and relevant to each partner. A semi social retreat where some time is set aside to plan the next year s educational program might be fun and might also re energize your partners. You can make it a yearly outing. Have some fun together and make sure you accomplish a written plan which you can all pledge to follow. Remember that the plan is YOURS! You can add to it, leave something out or alter it as often as you wish. 20

21 THIS IS IMPORTANT! Think about creative ways to learn about becoming better investors. We ll spend more time on this topic at our next TickerTalk! Marion Michel Ken Kavula Ann Cuneaz 42 21

Chart a Course to Better Sales Growth Forecasts

Chart a Course to Better Sales Growth Forecasts Ann Cuneaz, Education Program Manager, Ken Kavula, President, Mid-Michigan Chapter April 24, 2013 1 Disclaimer The information in this presentation is for