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July 22, 2015


ATTENTION Advanced Investors and Finance Professionals:
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VALUATION WATCH: Overvalued stocks now make up 55.59% of our stocks assigned a valuation and 21.74% of those equities are calculated to be overvalued by 20% or more.  Twelve sectors are calculated to be overvalued--with seven at or near double digits.

Editor's Note: Due to travel, from July 15th-July 27th our free newsletters will be on a reduced publication schedule. There will be no free weekly newsletters. Free daily's will be published fewer times per week. Normal publication schedules will resume July 27th.


--Biggest is the Best?

ValuEngine BUY Wells Fargo is the Largest Bank in the World

Wells Fargo & Company (WFC) is a diversified financial services company providing banking, insurance, investments, mortgage and consumer finance services through stores, its Internet site and other distribution channels across North America as well as internationally.

We've seen some rough times for banks over the past seven years or so. The mortgage meltdown, risky derivatives trading, massive salary and bonuses for CEOs despite poor performance, money laundering, etc. Bankers took some hits--and rightfully so.

But, if you consider the industry with a more recent eye for performance, you find that share prices, along with profits, are up big time. Banks have begun to break out of the crisis-driven period thanks to a housing recovery, settlements with regulatory bodies for their more egregious missteps, and the overall economic performance of the United States.

One of the institutions that is leading the way is Wells Fargo. The bank is now the largest in the world and is hovering close to the milestone of a $300 billion market cap. Unlike some of its Wall Street-based brethren, Wells Fargo largely eschews the risky trading and shenanigans favored in Manhattan.

The bank garners the lion's share of its profits from good "old fashioned" activities such as mortgages. It also keeps a tidier balance sheet--of all the major players Wells Fargo has the best capital reserves--as recently noted by the Fed. They avoid risky derivatives and don't play around in the "casino" with borrowed money. In other words, Wells Fargo is notable these days for doing what banks are supposed to do, in a conservative fashion, in a manner that rewards shareholders.

What a "crazy" idea ?!?!?!?!

ValuEngine continues its BUY recommendation on WELLS FARGO-NEW for 2015-07-21. Based on the information we have gathered and our resulting research, we feel that WELLS FARGO-NEW has the probability to OUTPERFORM average market performance for the next year. The company exhibits ATTRACTIVE Company Size and Sharpe Ratio.

Our Buy/Sell/Hold recommendations are based upon the 1-year forecast return figure. Using valuation and forecast figures, you can rank and rate our covered stocks against each other, to find out, in an objective and systematic way, the most attractive investment targets based on your own risk/reward parameters. We re-calculate the entire database every trading day, so you are assured that every proprietary valuation and forecast datapoint is as up-to-date as possible.

Below is today's more extensive data on WFC:


ValuEngine Forecast
 
Target
Price*
Expected
Return
1-Month
58.33 0.66%
3-Month
59.33 2.38%
6-Month
61.14 5.51%
1-Year
62.54 7.91%
2-Year
66.71 15.12%
3-Year
53.87 -7.04%

Valuation & Rankings
Valuation
15.16% overvalued
Valuation Rank(?)
29
1-M Forecast Return
0.66%
1-M Forecast Return Rank
90
12-M Return
14.12%
Momentum Rank(?)
73
Sharpe Ratio
0.96
Sharpe Ratio Rank(?)
91
5-Y Avg Annual Return
15.74%
5-Y Avg Annual Rtn Rank
79
Volatility
16.46%
Volatility Rank(?)
86
Expected EPS Growth
3.16%
EPS Growth Rank(?)
29
Market Cap (billions)
300.62
Size Rank
100
Trailing P/E Ratio
14.10
Trailing P/E Rank(?)
80
Forward P/E Ratio
13.67
Forward P/E Ratio Rank
67
PEG Ratio
4.46
PEG Ratio Rank
8
Price/Sales
3.37
Price/Sales Rank(?)
28
Market/Book
1.99
Market/Book Rank(?)
52
Beta
1.02
Beta Rank
48
Alpha
0.02
Alpha Rank
67

As a bonus to our Newsletter readers,
we are offering a FREE DOWNLOAD of one of our Stock Reports

Read our Complete Detailed Valuation Report on Wells Fargo HERE.

 

Want To Know More About Our ValuEngine View Newsletter?

Looking for a monthly portfolio of stock picks which are objective and based on cutting-edge academic theory and Wall St.practice? Then subscribe to The ValuEngine View Newsletter.The ValuEngine View Portfolio is based on our highly-refined and tested ValuEngine Portfolio Strategies along with our proprietary quant-based composite scoring system. The ValuEngine View Newsletter is the product of sophisticated stock valuation and forecast models first developed by Yale Professor of Finance Zhiwu Chen.

The ValuEngine View Newsletter is the product of a sophisticated stock valuation model that was first developed by ValuEngine's academic research team. It utilizes a three factor approach: fundamental variables such as a company's trailing 12-month Earnings-Per-Share (EPS), the analyst consensus estimate of the company's future 12-month EPS, and the 30-year Treasury yield are all used to create a more accurate reflection of a company's fair value. A total of eleven additional firm specific variables are also used. In addition, the portoflio uses top picks from our Forecast Model. In essence, the portfolio is constructed with the best picks from our main propiretary models

Each month you will receive an electronic copy of our newsletter highlighting 15 potential long positions along with five alternate picks. Our investment strategies focus on dozens of fundamental and technical factors for over 8000 individual stocks, synthesize the data, and then come up with a portfolio. Each newsletter portfolio focuses on maximum potential returns so there are no diversity requirements. Each portfolio pick includes critical ValuEngine valuation and forecast data. These 20 total picks represent the most up-to-date equity assessments of our proprietary models.

Please click HERE to subscribe. You may download a sample copy HERE. After your subscription is approved, you will immediately receive access to download the current issue of newsletter as well as the previous issues, which are all available as PDF files. Each month when the latest issue of the newsletter is released, we will send you an email, informing you to download it from the site. The newsletter is released near the middle of each month.

 

  VE View vs. S&P 500 Index Past Five Years
VE View
S&P 500
Ann Return
19.75% 14.13%
Ann Volatility
21.06% 11.13%
Sharpe Ratio
0.94 1.27
Sortino Ratio
1.55 1.56
Max Drawdown
-34.94% -11.14%

  The ValuEngine View Newsletter is derived from the ValuEngine Aggressive and Diversified Growth BenchmarkPortfolio Strategies. These strategies are the product of ValuEngine's academic research team and combine cutting-edge financial analysis and portfolio construction techniques with real-world Wall St. know how. 

CLICK HERE to Subscribe to the ValuEngine View

The ValuEngine View Newsletter portfolio has 15 primary stock picks and five alternates and is re-balanced once each month. The ValuEngine View Newsletter is published near the middle of each calendar month. An equal amount of capital is allocated to each stock. The monthly returns are calculated from the closing prices on date of publication. The performance calculation does not include any transaction costs.

 

 

ValuEngine Market Overview

Summary of VE Stock Universe
Stocks Undervalued
44.41%
Stocks Overvalued
55.59%
Stocks Undervalued by 20%
17.79%
Stocks Overvalued by 20%
21.74%

ValuEngine Sector Overview

Sector
Change
MTD
YTD
Valuation
Last 12-MReturn
P/E Ratio
-0.50%
1.32%
16.96%
23.20% overvalued
17.61%
30.96
-0.93%
0.57%
6.52%
17.63% overvalued
-7.19%
20.57
-0.49%
-0.94%
2.15%
11.86% overvalued
-1.19%
22.55
-0.26%
-0.06%
7.97%
9.21% overvalued
-0.35%
29.03
-0.98%
-1.72%
0.65%
8.07% overvalued
-3.80%
25.28
-0.70%
-0.98%
3.98%
7.84% overvalued
-0.91%
24.20
-0.34%
-3.37%
1.02%
7.46% overvalued
2.47%
30.05
-0.46%
-0.54%
0.28%
7.27% overvalued
5.91%
26.11
-0.22%
0.24%
3.17%
6.59% overvalued
2.04%
17.63
0.40%
-0.20%
-2.31%
1.95% overvalued
-0.07%
17.68
-0.21%
-0.45%
-0.78%
0.74% overvalued
-6.51%
20.50
-0.38%
-0.22%
2.35%
0.29% overvalued
-1.58%
23.44
-0.66%
-1.34%
0.13%
0.59% undervalued
-10.68%
16.11
-1.00%
-3.43%
0.18%
3.65% undervalued
-10.95%
19.51
0.41%
-9.34%
-9.71%
10.88% undervalued
-40.98%
22.19
0.02%
-7.51%
-8.84%
15.50% undervalued
-26.43%
23.76

 

 

 

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