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: +55.5% for the 60 months ending May 9, 2018 (vs. +82.6% for the S&P)
For complete performance data, click here
Vol.16 #108 Thursday, May 10, 2018 4:34PM EDT

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

Market Stance: BULLISH (since April 10, 2018)

Contents

Typical Client Performance
Bought Sunrun Inc. (RUN)
Sold SPDR S&P 500 ETF (SPY) +2.8%
Typical Client Portfolio
Subscription Information
Privacy Policy
Disclaimers
Contact Us

Typical Client Performance

Deen Capital S&P 500
Year-to-date as of May 9, 2018 +0.1% * +1.5%
12 months (May 9, 2017 to May 9, 2018) +9.8% * +14.6%
24 months (May 9, 2016 to May 9, 2018) +45.4% * +36.1%
36 months (May 9, 2015 to May 9, 2018) +27.7% * +35.1%
48 months (May 9, 2014 to May 9, 2018) +39.3% * +55.1%
60 months (May 9, 2013 to May 9, 2018) +55.5% * +82.6%

* 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 Sunrun Inc. (RUN)

Initial percent of portfolio (approx.)6.0%
Net buy price in managed accounts*$11.54
Most recent close (May 09)$9.83
Net change (based on net buy price)+1.71
Today's volume as of 4:00PM EDT9.2 million ($105.8 million)
Average daily volume2.5 million ($28.7 million)
This year's earnings-per-share$1.07 (est)
Next year's earnings-per-share$1.30 (est)
P/E using next year's earnings8.9 (est)
Earnings growth rate, next 5 years9% per year (est)

* Buy prices shown are net after commissions and fees.

Today, Thursday, May 10, 2018, I bought RUN, for both client and my personal accounts.

Here's why I bought this stock:

+ Earnings surprise: Yesterday, May 9, after the close, the company announced results for the quarter ended March 31. Earnings came in at 25c per diluted share (vs 9c last year and analysts' consensus 16c). Revenue was up 37% to $144.4 million (analysts' consensus $132.7 million).

+ Breakout: The stock is up sharply today on heavy volume, breaking out of a 2-year range to a new all-time high.

+ Volume spike, mostly on the buy side: Today's volume is more than 3x average and is a 12-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: +12%, +26%, +21%, and, most recently, as cited above, +37%.

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

Jun 17 vs Jun 16: 23c vs 31c
Sep 17 vs Sep 16: 25c vs 16c
Dec 17 vs Dec 16: 25c vs 27c
Mar 18 vs Mar 17: 25c vs 09c

+ Valuation: At 8.9 times next year's estimated earnings and a projected 5-year annualized earnings growth rate of 9%, the stock may still be, even after yesterday's price jump, attractively priced.

+ 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 factors:

- Strong but falling earnings-per-share estimates: According to recent data from First Call, the consensus earnings estimate for 2018 is $1.07, revised downward from $1.56 90 days ago (and up from 2017 actual earnings of 83c); and the consensus estimate for 2019 is $1.30, revised downward from $1.85 90 days ago.

- The company's industry group ("Energy - Solar") is ranked #39 for relative strength out of 197 industry groups tracked by Investor's Business Daily. This ranking changes daily, and it has been generally falling over recent weeks and months.

-KD, Thursday, May 10, 2018

Sold SPDR S&P 500 ETF (SPY) +2.8%

Net sell price in managed accounts*$271.70
Date(s) boughtApr 10 2018
Net buy price in managed accounts*$264.27
Holding period4.3 weeks
Gain/loss in managed accounts*+2.8% (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, Thursday, May 10, 2018, I sold SPY, for both client and my personal accounts.

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

-KD, Thursday, May 10, 2018

Typical Client Portfolio

Company Name Stock
Symbol
Buy
Date
NetBuy
Price*
Current
Price**
Weeks
Held
% of
Portfolio
Gain
(Loss)
Sunrun Inc. RUN 05/10/18 $11.54 $11.54 0.0 5.9% +0.0%
Diodes Inc. DIOD 05/10/18 $32.94 $32.96 0.0 5.0% +0.1%
Zebra Technologies Corp. ZBRA 05/09/18 $153.86 $152.72 0.1 5.0% -0.7%
Xcerra Corp. XCRA 05/09/18 $13.35 $13.68 0.1 4.9% +2.4%
Penn Virgina Corp. PVAC 05/09/18 $62.06 $62.18 0.1 5.0% +0.2%
Expeditors International EXPD 05/09/18 $70.12 $71.69 0.1 4.7% +2.2%
Stoneridge Inc. SRI 05/08/18 $27.89 $28.94 0.3 5.1% +3.8%
iShares Core S&P 500 IVV 05/08/18 $267.81 $273.69 0.3 4.8% +2.2%
Nanometrics Inc. NANO 05/07/18 $35.55 $37.00 0.4 5.1% +4.1%
Malibu Boats, Inc. MBUU 05/03/18 $40.74 $41.70 1.0 5.0% +2.3%
Centene Corp. CNC 05/03/18 $114.88 $113.36 1.0 4.8% -1.3%
Enova International, Inc. ENVA 05/01/18 $28.90 $32.67 1.3 5.5% +13.1%
DMC Global, Inc. BOOM 04/27/18 $39.54 $40.83 1.9 5.2% +3.2%
SPDR S&P 500 ETF SPY 04/25/18 $262.51 $271.83 2.1 11.7% +3.5%
SPDR S&P 500 ETF SPY 04/10/18 $264.27 $271.83 4.3 22.1% +2.9%
Cash 0.2%  
Total 100%  

* Buy prices shown are net after commissions.

** Current prices are at least 20 minutes old.

Subscription Information

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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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