The Deen's ListTM
A service of Deen Capital Management, Inc. (
Our goal: Outperform the S&P 500 in both up markets and down.
Our result: +67.1% for the 60 months ending April 16, 2018 (vs. +87.4% for the S&P)
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Vol.16 #82 Tuesday, April 17, 2018 1:55PM EDT

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Market Stance: BULLISH (since April 10, 2018)


Typical Client Performance
Bought Netflix Inc. (NFLX)
Sold SPDR S&P 500 ETF (SPY) +2.0%
Typical Client Portfolio
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Typical Client Performance

Deen Capital S&P 500
Year-to-date as of April 16, 2018 -0.1% * +0.7%
12 months (Apr 16, 2017 to Apr 16, 2018) +13.7% * +17.1%
24 months (Apr 16, 2016 to Apr 16, 2018) +41.3% * +33.7%
36 months (Apr 16, 2015 to Apr 16, 2018) +23.0% * +34.9%
48 months (Apr 16, 2014 to Apr 16, 2018) +38.1% * +55.4%
60 months (Apr 16, 2013 to Apr 16, 2018) +68.6% * +87.4%

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

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Bought Netflix Inc. (NFLX)

Initial percent of portfolio (approx.)5.1%
Net buy price in managed accounts*$337.97
Most recent close (Apr 16)$307.78
Net change (based on net buy price)+30.19
Today's volume as of 1:56PM EDT25.9 million ($8.7 billion)
Average daily volume11.3 million ($3.8 billion)
This year's earnings-per-share$2.72 (est)
Next year's earnings-per-share$4.27 (est)
P/E using next year's earnings79.1 (est)
Earnings growth rate, next 5 years71% per year (est)

* Buy prices shown are net after commissions and fees.

Today, Tuesday, April 17, 2018, I bought NFLX, for both client and my personal accounts.

This stock is a component of the S&P 500 and the NASDAQ 100.

Here's why I bought this stock:

+ Earnings news: Yesterday, Apr 16, after the close, the company announced results for the quarter ended March 31. Earnings came in at 64c per diluted share (vs 40c last year and in line with analysts' consensus). Revenue was up 40% to $3.70 billion (analysts' consensus $3.69 billion). Subscriber growth was also above expectations.

+ Breakout: The stock is up sharply today on heavy volume, breaking out of a 5-week range to a new all-time high.

+ Volume spike, mostly on the buy side: As I write this, a little more than 2 hours before the close, volume is already more than twice the daily average, and is on track to set a 9-month record.

+ Excellent and accelerating recent sales growth. Here are the quarterly year-to-year sales growth rates from the last four quarters, in chronological order: +32%, +30%, +33%, and, most recently, as cited above, +40%.

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

Jun 17 vs Jun 16: 15c vs  9c
Sep 17 vs Sep 16: 29c vs 12c
Dec 17 vs Dec 16: 41c vs 15c
Mar 18 vs Mar 1u: 64c vs 40c

+ Strong and rising earnings-per-share estimates: According to recent data from First Call, the consensus earnings estimate for 2018 is $2.72, revised upward from $2.29 90 days ago (and up from 2017 actual earnings of $1.25); and the consensus estimate for 2019 is $4.27, revised upward from $3.79 90 days ago.

Valuation: At 79 times next year's estimated earnings and a projected 5-year annualized earnings growth rate of 71%, the stock is, by my usual metric, reasonably priced.

+ The company's industry group ("Leisure - Movies & Related") is ranked #3 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.

-KD, Tuesday, April 17, 2018

Sold SPDR S&P 500 ETF (SPY) +2.0%

Net sell price in managed accounts*$269.63
Date(s) boughtApr 10 2018
Net buy price in managed accounts*$264.27
Holding period1.0 weeks
Gain/loss in managed accounts*+2.0% (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, Tuesday, April 17, 2018, I sold SPY, for both client and my personal accounts.

I sold just enough SPY to pay for NFLX. We remain fully invested.

-KD, Tuesday, April 17, 2018

Typical Client Portfolio

Company Name Stock
% of
Netflix Inc. NFLX 04/17/18 $337.97 $338.05 0.0 5.0% +0.0%
Movado Group Inc. MOV 04/17/18 $39.68 $39.60 0.0 5.0% -0.2%
Viper Energy Partners LP VNOM 04/12/18 $27.02 $28.96 0.7 5.3% +7.2%
NV5 Global, Inc. NVEE 04/11/18 $58.95 $61.98 0.9 6.2% +5.1%
SPDR S&P 500 ETF SPY 04/10/18 $264.27 $270.05 1.0 72.4% +2.2%
Stoneridge Inc. SRI 04/06/18 $28.97 $29.23 1.6 6.1% +0.9%
Cash 0.1%  
Total 100%  

* Buy prices shown are net after commissions.

** Current prices are at least 20 minutes old.

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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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