The Deen's ListTM
A service of Deen Capital Management, Inc. (www.deencapital.com)
Our goal: Outperform the S&P 500 in both up markets and down.
Our result: +12.5% for the 60 months ending April 1, 2016 (vs. +71.9% for the S&P)
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Vol.14 #73 Monday, April 4, 2016 3:37PM EDT

Please read carefully our disclaimers at the end of this newsletter.

Market Stance: BULLISH (since February 22, 2016)

Contents

Typical Client Performance
Bought Edwards Lifesciences Corp. (EW)
Sold Stamps.com Inc. (STMP) -10.2%
Typical Client Portfolio
Subscription Information
Privacy Policy
Disclaimers
Contact Us

Typical Client Performance

Deen Capital S&P 500
Year-to-date as of April 1, 2016 -5.3% * +2.0%
12 months (Apr 1, 2015 to Apr 1, 2016) -11.4% * +2.7%
24 months (Apr 1, 2014 to Apr 1, 2016) -7.6% * +14.3%
36 months (Apr 1, 2013 to Apr 1, 2016) +11.0% * +40.7%
48 months (Apr 1, 2012 to Apr 1, 2016) +12.2% * +59.4%
60 months (Apr 1, 2011 to Apr 1, 2016) +11.4% * +71.9%

* An average of managed accounts, net after all commissions and fees.

Click here for more performance data.

Click here for information on managed accounts.

Bought Edwards Lifesciences Corp. (EW)

Initial percent of portfolio (approx.)9.0%
Net buy price in managed accounts*$105.00
Most recent close (Apr 01)$89.92
Net change (based on net buy price)+15.08
Today's volume as of 3:38pm EDT8.1 million ($852.0 million)
Average daily volume2.0 million ($205.1 million)
This year's earnings-per-share$2.64 (est)
Next year's earnings-per-share$3.05 (est)
P/E using next year's earnings34.4 (est)
Earnings growth rate, next 5 years15% per year (est)
Corporate HeadquartersIrvine, CA
Web sitewww.edwards.com

* Buy prices shown are net after commissions and fees.

Today, Monday, April 4, 2016, I bought EW, for both client and my personal accounts.

Edwards Lifesciences Corp. provides products and technologies to treat structural heart disease and critically ill patients worldwide.

This stock is a component of the S&P 500 Index.

Here's why I bought this stock:

+ News: Yesterday, after the close, the company announced results of a clinical trial of a replacement heart valve. The new valve was shown to be clinically superior to surgery.

+ Breakout: The stock is up sharply today on huge volume. It was also up Friday. Friday's move was a fractional breakout from a 5-week range to a new all-time high.

+ Volume spike, mostly on the buy side: As I write this, about a half hour before the close, volume is approaching 4 times the daily average, and has already set a 12-month record.

+ Positive recent sales growth. Here are the quarterly year-to-year sales growth rates from the last four quarters, in chronological order: +13%, +7%, +1%, and, most recently, for the quarter ended Dec 31, +9% to $671.1 million.

+ Excellent recent earnings-per-share growth. Here are the quarterly EPS figures for the last eight quarters:

Mar 15 vs Mar 14: 56c vs 38c
Jun 15 vs Jun 14: 57c vs 44c
Sep 15 vs Sep 14: 54c vs 40c
Dec 15 vs Dec 14: 63c vs 53c

+ Strong and rising earnings-per-share estimates: According to recent data from First Call, the consensus earnings estimate for 2016 is $2.64, revised upward from $2.39 90 days ago (and up from 2015 actual earnings of $2.29); and the consensus estimate for 2017 is $3.05, revised upward from $2.81 90 days ago.

+ History of earnings surprises: This company has reported earnings-per-share at least a penny above estimates in each of the past 11 quarters. Most recently, for the quarter ended Dec 31, they "beat the Street" by a penny.

+ The company's industry group ("Medical - Products") is ranked #91 for relative strength out of 197 industry groups tracked by Investor's Business Daily. This ranking changes daily, and it has been generally rising over recent weeks and months.

+ The stock's 200-day moving average is rising, indicating a long-term uptrend.

I chose to buy the stock in spite of the following negative factor:

- Valuation: At 34 times next year's estimated earnings and a projected 5-year annualized earnings growth rate of 15%, the stock is somewhat pricey by my usual yardstick.

-KD, Monday, April 4, 2016

Sold Stamps.com Inc. (STMP) -10.2%

Net sell price in managed accounts*$99.47
Date(s) boughtMar 30 2016
Net buy price in managed accounts*$110.78
Holding period0.7 weeks
Gain/loss in managed accounts*-10.2% (after commissions)

* Buy and sell prices shown are net after commissions and fees. This means that the gain/loss shown is also net after transaction expenses.

Today, Monday, April 4, 2016, I sold STMP, for both client and my personal accounts.

I sold STMP because it is trading below my stop-loss price of $108.18.

-KD, Monday, April 4, 2016

Typical Client Portfolio

Company Name Stock
Symbol
Buy
Date
NetBuy
Price*
Current
Price**
Weeks
Held
% of
Portfolio
Gain
(Loss)
Edwards Lifesciences Corp. EW 04/04/16 $105.00 $104.47 0.0 9.0% -0.5%
SPDR S&P 500 ETF SPY 04/01/16 $205.91 $206.02 0.4 7.4% +0.1%
Anika Therapeutics Inc. ANIK 03/28/16 $44.83 $44.76 1.0 8.8% -0.1%
Cooper-Standard Holdings Inc CPS 03/21/16 $71.25 $71.79 2.0 8.4% +0.8%
Adobe Systems Inc. ADBE 03/18/16 $93.87 $94.57 2.4 9.0% +0.7%
Fabrinet FN 03/11/16 $28.08 $31.09 3.4 9.8% +10.7%
Universal Electronics Inc. UEIC 03/10/16 $64.20 $62.91 3.6 9.8% -2.0%
MaxLinear, Inc. MXL 03/10/16 $17.55 $18.61 3.6 10.7% +6.0%
ExlService Holdings EXLS 03/03/16 $48.24 $51.91 4.6 7.1% +7.6%
John Bean Technologies Corp. JBT 02/29/16 $52.83 $54.98 5.0 10.0% +4.1%
Texas Roadhouse Inc. TXRH 02/24/16 $41.48 $44.07 5.7 9.5% +6.2%
Cash 0.6%  
Total 100%  

* Buy prices shown are net after commissions.

** Current prices are at least 20 minutes old.

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Disclaimers

All stocks discussed in The Deen's ListTM involve a high degree of risk. It should not be assumed that any stock discussed in The Deen's ListTM or purchased by Deen Capital Management, Inc. will be profitable.

Past performance is not necessarily indicative of future results.

The information contained herein has been compiled from sources deemed to be reliable; however, we are not responsible for its accuracy or completeness.

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