Best Value Companies To Buy For 2015

Research Affiliates is best known for its fundamental indexing strategies that seek to capture inherent value that capitalization-based indexes based on market price overlook.

It is therefore something of a surprise to see in the August newsletter of Research Affiliates, the Newport Beach-based firm founded by Rob Arnott, a not entirely negative evaluation of momentum-based investing, which is, after all, a strategy that is opposite to value investing (on which fundamental indexing is based).

The article, “Hot Potato: Momentum as an Investment Strategy,” by Research Affiliates Vice President Ryan Larson, describes momentum as a “lively game of hot potato—buying rapidly appreciating stocks, holding them for a relatively short period, and selling them before their price trends reverse direction.”

Larson reviews evidence for momentum and cites studies showing it can have superlative results in favorable conditions. For example, he cites the first comprehensive study of the subject in 1993, which found momentum to be the best-performing strategy from 1965 to 1989. In that period, that entailed buying stocks that outperformed the previous 12 months while shorting losers and holding those positions for the subsequent three months.

Best Value Companies To Buy For 2015: Caterpillar Inc.(CAT)

Caterpillar Inc. manufactures and sells construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives worldwide. It operates through three lines of businesses: Machinery, Engines, and Financial Products. The Machinery business offers construction, mining, and forestry machinery, including track and wheel tractors, track and wheel loaders, pipelayers, motor graders, wheel tractor-scrapers, track and wheel excavators, backhoe loaders, log skidders, log loaders, off-highway trucks, articulated trucks, paving products, skid steer loaders, underground mining equipment, tunnel boring equipment, and related parts. It also manufactures diesel-electric locomotives; and manufactures and services rail-related products and logistics services for other companies. The Engines business provides diesel, heavy fuel, and natural gas reciprocating engines for Caterpillar machinery, electric power generation systems, marine, petrol eum, construction, industrial, agricultural, and other applications. It offers industrial turbines and turbine-related services for oil and gas, and power generation applications. This business also remanufactures Caterpillar engines, machines, and engine components; and offers remanufacturing services for other companies. The Financial Products business provides retail and wholesale financing alternatives for Caterpillar machinery and engines, solar gas turbines, and other equipment and marine vessels, as well as offers loans and various forms of insurance to customers and dealers. It also offers financing for vehicles, power generation facilities, and marine vessels. The company markets its products directly, as well as through its distribution centers, dealers, and distributors. It was formerly known as Caterpillar Tractor Co. and changed its name to Caterpillar Inc. in 1986. Caterpillar Inc. was founded in 1925 and is headquartered in Peoria, Illinois.

Advisors' Opinion:

• [By Dan Caplinger]

  But sales trends remain abysmal in many parts of the market, especially in the former growth hot-spot of the Asia-Pacific region. Rival Caterpillar (NYSE: CAT  ) has seen sales in the region swing from year-over-year gains as recently as November to declines of 20% or more in each of the past three months. Latin America has been a bright spot for Caterpillar, but otherwise, the rest of the world has seen a substantial slowdown, with overall sales down 13% in April.

• [By Daniel Miller]

  The U.S. economy has rebounded gradually, which is more than the rest of the world can say. Unfortunately for Caterpillar (NYSE: CAT  ) , which derives the majority of its profits internationally, a global rebound can't come soon enough. The stock is down about 22% over the last 12 months and sits at a price to earnings ratio well below its historical average. Caterpillar recently released its first-quarter information, which disappointed investors but its stock price remained unaffected ��it even rose in the days after the earnings release. Does this mean Caterpillar stock has finally bottomed out, giving investors a chance to buy in?

Best Value Companies To Buy For 2015: Tupperware Corporation(TUP)

Tupperware Brands Corporation operates as a direct seller of various products across a range of brands and categories through an independent sales force. The company engages in the manufacture and sale of kitchen and home products, and beauty and personal care products. It offers preparation, storage, and serving solutions for the kitchen and home, as well as kitchen cookware and tools, children?s educational toys, microwave products, and gifts under the Tupperware brand name primarily in Europe, Africa, the Middle East, the Asia Pacific, and North America. The company provides beauty and personal care products, which include skin care products, cosmetics, bath and body care, toiletries, fragrances, nutritional products, apparel, and related products principally in Mexico, South Africa, the Philippines, Australia, and Uruguay. It offers beauty and personal care products under the Armand Dupree, Avroy Shlain, BeautiControl, Fuller, NaturCare, Nutrimetics, Nuvo, and Swissgar de brand names. The company sells its Tupperware products directly to distributors, directors, managers, and dealers; and beauty products primarily through consultants and directors. As of December 26, 2009, the Tupperware distribution system had approximately 1,800 distributors, 61,300 managers, and 1.3 million dealers; and the sales force representing the Beauty businesses approximately 1.1 million. The company was formerly known as Tupperware Corporation and changed its name to Tupperware Brands Corporation in December 2005. The company was founded in 1996 and is headquartered in Orlando, Florida.

Advisors' Opinion:

• [By Oliver Pursche]

  European large-cap pharmaceuticals like Novartis (NVS) �and Bristol Meyers Squibb (BMY) �count amongst some of our favorite stocks right now, as do U.S. multinationals that are growing revenue and margins in Asia ��Tupperware (TUP) �is a shining example. Stay away from utilities and energy stocks, as they are likely to be the laggards over the next year.

• [By Johanna Bennett]

  Corporate earnings took a back seat today to the Fed�� latest policy decision. Still, quarterly financial results, and other news sent shares of McCormick & Co. (MKC) and Tupperware (TUP), falling during regular market hours�Here�� a rundown of several of today�� moves:

• [By Dan Caplinger]

  Where growth will come from
  One area that Newell Rubbermaid still has to tap fully is emerging markets. The company has done a good job of expanding overseas, with 17% annual growth in Latin America. But with barely a quarter of its sales coming from outside the U.S. and Canada, the company has a lot further to go. Storage rival Tupperware (NYSE: TUP  ) gets fully 60% of its total revenue from emerging markets, and it too has seen impressive gains in South America as well as the Asia-Pacific region.

• [By John Kell]

  Among the companies with shares expected to actively trade in Wednesday’s session are Dow Chemical Co.(DOW), Tupperware Brands Corp.(TUP) and Yahoo Inc.(YHOO)

Best Internet Companies To Buy Right Now: Dollar Tree Inc.(DLTR)

Dollar Tree, Inc. operates discount variety stores in the United States and Canada. Its stores offer merchandise primarily at the fixed price of $1.00. The company operates its stores under the names of Dollar Tree, Deal$, Dollar Tree Deal$, Dollar Giant, and Dollar Bills. Its stores offer consumable merchandise, including candy and food, and health and beauty care, as well as household consumables, such as paper, plastics, household chemicals, in select stores, and frozen and refrigerated food; variety merchandise, which includes toys, durable housewares, gifts, party goods, greeting cards, softlines, and other items; and seasonal goods, such as Easter, Halloween, and Christmas merchandise. As of April 30, 2011, it operated 4,089 stores in 48 states and the District of Columbia, as well as 88 stores in Canada. The company was founded in 1986 and is based in Chesapeake, Virginia.

Advisors' Opinion:

• [By Brendan Byrnes]

  Brendan: Not a problem at all. What about the surprising amount of dollar-store companies that are public? You have Family Dollar (NYSE: FDO  ) , Dollar Tree (NASDAQ: DLTR  ) , Dollar General (NYSE: DG  ) . You mention, in particular, Family Dollar, which is the lowest market cap out of all of those, as doing the best, an exceptional company. Why?

• [By Paul Ausick]

  The other stock the firm likes is Dollar Tree Inc. (NASDAQ: DLTR). The company�� shares have lost about 4.6% since reporting an earnings per share (EPS) miss for the third quarter and the Sterne Agee analysts see the lower price as a ��reat entry point��for buying the stock. Dollar Tree raised fiscal year 2013 EPS guidance from a range of $2.66 to $2.77 to a new range of $2.72 to $2.78, effectively raising the mid-point by $0.04. Sterne Agee reiterated its Buy rating on the stock with a price target of $63. Dollar Tree�� shares are trading down nearly 0.4% at $55.99 in a 52-week range of $37.47 to $60.19.

• [By Ben Levisohn]

  Shares of Supervalu have dropped 8.3% to $6.31 at 2:59 p.m., within spitting distance of Goldman’s $6 target price, while competitors Family Dollar Stores (FDO) has gained 0.2% to $70.16,�Dollar General�(DG) has fallen 0.4% t0 $59.02,�Dollar Tree (DLTR) is off 1% to $59.33 and Wal-Mart (WMT) is little changed at $79.19.

• [By Lawrence Meyers]

  As a convenience store, it doesn’t have direct competition from�Dollar Tree (DLTR) or Family Dollar (FDO) because these dollar stores aren�� exclusively focused on food (and they have no gasoline or cigarette sales), and they��e targeted at the folks who are trying to save money over convenience, not vice versa. The convenience angle is another reason why�Walmart (WMT) and Costco (COST)�aren’t competitors, since those behemoths are about a total shopping experience.

Best Value Companies To Buy For 2015: Schlumberger N.V.(SLB)

Schlumberger Limited, together with its subsidiaries, supplies technology, integrated project management, and information solutions to the oil and gas exploration and production industries worldwide. The company?s Oilfield Services segment provides exploration and production services; wireline technology that offers open-hole and cased-hole services; supplies engineering support, directional-drilling, measurement-while-drilling, and logging-while-drilling services; and testing services. This segment also offers well services; supplies well completion services and equipment; artificial lift; data and consulting services; geo services; and information solutions, such as consulting, software, information management system, and IT infrastructure services that support oil and gas industry. Its WesternGeco segment provides reservoir imaging, monitoring, and development services; and operates data processing centers and multiclient seismic library. This segment also offers variou s services include 3D and time-lapse (4D) seismic surveys to multi-component surveys for delineating prospects and reservoir management. The company?s M-I SWACO segment supplies drilling fluid systems to improve drilling performance; fluid systems and specialty tools to optimize wellbore productivity; production technology solutions to maximize production rates; and environmental solutions that manages waste volumes generated in drilling and production operations. Its Smith Oilfield segment designs, manufactures, and markets drill bits and borehole enlargement tools; and supplies drilling tools and services, tubular, completion services, and other related downhole solutions. The company?s Distribution segment markets pipes, valves, and fittings, as well as mill, safety, and other maintenance products. This segment also provides warehouse management, vendor integration, and inventory management services. Schlumberger Limited was founded in 1927 and is based in Houston, Texas.

Advisors' Opinion:

• [By R.P.H. Broens]

  Halliburton (NYSE: HAL  ) �and�Schlumberger (NYSE: SLB  ) �are two larger competitors with market capitalizations two and five times that of Baker Hughes, respectively. Schlumberger, which is the industry leader, trades at the highest valuation multiples: 2.7 times 2012's annual revenues and 21 times earnings. Halliburton and Baker Hughes trade at lower and more acceptable earnings ratios of around 18 times earnings for 2012. Note that these competitors have seen rapid growth and margin expansion in recent years as well.

• [By David Smith]

  A few of the compelling companies
  From my perspective, the message to be taken away from Stuart's presentation is simply that, even in the face of potential U.S. economic distress, a well-structured portfolio will contain at least a modicum of energy of names. For starters I'd look to Schlumberger (NYSE: SLB  ) , the world's leading oilfield services company and energy's technology major domo. Given its operations in about 85 countries, a worldwide energy cataclysm would seemingly be required for the big company to face a significant slowdown.

• [By Arjun Sreekumar]

  Not surprisingly, the industry's annual capital spending has more than tripled over the past decade, coming in at $550 billion in 2011, according to oil-field services firm Schlumberger (NYSE: SLB  ) . Yet despite shelling out all that money, the industry as a whole has been unable to secure enough new reserves to offset production.