Skip to main content

Factor Based Analysis, Mid Cap Adv/Mkt - Part 1

investment analysis looking for a gem
Ya, we're excited too.

Overview

This is a factor-based analysis looking at six mid-sized companies in the marketing and advertising space.  It will look at the relative strengths and weaknesses of the group members with the goal of finding a gem.

Peer Group:

Stock Name (Symbol)Last Price (May 31, 2019)Market Cap
Trade Desk, Inc. Class A(TTD:XNAS)$198.818.8429B
LiveRamp Holdings, Inc.(RAMP:XNYS)$51.383.4986B
Nielsen Holdings PLC(NLSN:XNYS)$22.738.0804B
Jcdecaux SA(JCDXF:OOTC)$27.805.9161B
Interpublic Group of Companies, Inc.(IPG:XNYS)$21.228.1952B
Groupon, Inc. Class A(GRPN:XNAS)$3.532.0050B

  Analysis Factors

This analysis will look at six factors:
  • Price Momentum
  • Quality
  • Growth
  • Income
  • Value
  • Profitability.

Price Momentum

This factor includes a long, medium and short-term measure.  Long term is the percentage price change over two years, medium is 12 month less one month price change and short-term is the price less three month moving average.  I'm going to look the market, the sector and then each stock in the group.


LongMediumShort
Market14%9%-4%
Sector (proxy S&P industrials)5%6%-6%
The conclusion I draw from this is to proceed with caution, as momentum appears to slowing and possibly reversing.
Let's look at all the individual stocks next.  I'm looking at the same long and medium term momentum measures, the short term measure is the price change less the 10 week moving average.  The chart below shows the value each stock calculated for the measure and below that its relative ranking compared to the group.  The higher the number, the better its rank.



LongMediumShortSumFinal Rank
TTD261%
6		159%
6		-2%
5		176
RAMP96%
5		99%
5		-8%
3		135
NLSN-41%
1		-15%
2		-9%
2		51
JCDXF-17%
2		3%
4		-10%
1		72
IPG-15%
3		2%
3		-4%
4		103
GRPN17%
4		-27%
1		0%
6		114
TTD had the best relative momentum score and definitely impressive results from an absolute perspective.  RAMP 's are good too.  Both are showing short term momentum weakness.

Tomorrow I'll review the quality and growth factors.
Labels:

Comments

Post a Comment

Popular posts from this blog

11 Reasons Why INVRS is Better Than Excel Alone

If you work with your own investment models you likely use excel to build them, but excel isn’t ideal for many reasons and it costs you in other ways.
First, you need good data and it isn’t just lying around in an easy to import format.You’re either keying it in yourself or paying money for excel downloads.
When you need data from numerous sources – price information, data from different statements and across multiple years - you must merge it from multiple sheets.  It's an inefficient process which can lead to data corruption.
After all this data is collected and merged, models built and tested, the net result is one statistic for one company.A stand-alone number without context has limited use.To be meaningful, you need to compare it to similar companies. This is just a sample of the challenges.  You need software that overcomes these problems and is designed for investment model creation.
Surprise!  This software exists, it's INVRS.  You can get a free analysis report on …
Post a Comment
Read more

NextEra - Good Dividend in the Renewable Energy Sector

NextEra had good results relative to a group of peers in a factor-based analysis.NextEra has an appealing profitability and income profile.Its price momentum looks decent, with a caveat.Its relatively small size (a small mid-cap) coupled with its industry (renewable energy) further weight the odds that this company could be a strong performer in the future.
The Analysis Overview
I created a portfolio of stocks in the alternative energy sector, looking specifically for companies with a market cap over $1B but less than $4B.  This is a sweet spot that offers strong potential for growth but is also substantial enough not to be too speculative.

It's my believe that alternative energy is on the ascendance, where as fossil fuels will inevitably decline (NextEra isn't a pure play in this regard however, natural gas assets are part of its portfolio).  If you share this belief and you want exposure to this market, NextEra looks like a good bet.

This is a factor-based analysis on seven …
Post a Comment
Read more