The Daily Workshop Report
by Robert Sheard (TMF Sheard)

LEXINGTON, KY. (Oct. 22, 1997)

Scroll to the bottom for year-to-date Growth and Value Screen results.

Much discussion continues in our message folders about the likely changes to our database as we close out 1997 and launch 1998. And while web readers haven't been privy directly to the discussion in our AOL message folder, I want to summarize the major topics and outline a brief proposal that has met with at least initial good favor in the AOL folder.

I'm trying to balance a number of factors in considering how we should revise our database for the new year. One is simply a practical concern; the database as it's set up and tracked currently is a time black hole. Another concern is that I don't want readers investing in strategies they don't understand, simply because they see a gaudy number somewhere. And a third concern readers have is the need to have a centralized, reliable, and timely source for the data they need and can't get easily, quickly, or in some cases, at all, on their own.

I believe the following proposal satisfies those three concerns. On a weekly basis (better than our current monthly official updates) I would provide the following in a table format readers can paste into their own spreadsheets: Company Name, Ticker Symbol, Price/Earnings Ratio, Price/Sales Ratio, Earnings-Per-Share Growth Rate over the past year, Total Return over the past six months, Projected Earnings-Per-Share Growth Rate.

In addition, to help those using Unemotional Growth and Relative Strength models with the Investor's Business Daily rankings, I'll provide a list each week of the ten stocks with the highest EPS scores and a list of the ten stocks with the highest RS scores.

I will also continue to post a list of all the stocks that qualify as Investing for Growth stocks, both in IFG order and in order by relative strength (I'll use the total return over the previous 6 months for this screen).

Finally, instead of tracking dozens of screens over multiple holding periods, I will track five portfolios, with the understanding that readers are welcome and invited to follow their favorite versions publicly in the message board folders. The five portfolios I propose to track are the Unemotional Growth Portfolio (using a monthly update cycle), the Investing for Growth Portfolio (quarterly cycle), the Investing for Growth Portfolio with Relative Strength (using either a quarterly or a semi-annual cycle, still to be determined), a Relative Strength Portfolio based on total return over the past six months (using an annual holding period), and the Keystone Portfolio (also on an annual holding period).

Other holding periods may well be better than the ones I'm proposing, but my intuition and past research leads me to believe these are about right, and I invite readers to track the same portfolios with other holding periods along with us.

The only major statistic my proposal leaves out of the equation is the consensus earnings estimate (and the calculations for the YPEG that are based on this estimate), but for readers on both our AOL site (in First Call) and readers on the web site (in Yahoo's Research feature), those estimates are available free to everyone. Since transcribing those values into the current database is a large chunk of the manual preparation time, leaving this aspect of the database to individuals who want it to compile for themselves is a great help to me.

Another advantage specifically to web readers is that the database I'm proposing will now be available every Friday instead of sometime Monday. I hope this suits the vast majority of you. AOL readers, please post your thoughts to our message folder and web readers, please drop me a note via e-mail giving me your thoughts. With the number of responses I've already received, though, I can't promise to respond to every note on this issue individually. Fool on!

Monthly Growth Screens
(Jan. 3 to present)
96.50%  Relative Strength  
42.36%  Investing for Growth  
38.16%  EPS Plus RS  
29.48%  S&P 500 Index  
26.28%  Formula 90  
26.05%  YPEG Potential  
22.79%  Unemotional Growth  
22.42%  Low Price/Sales  

Annual Value Screens
(Jan. 1 to present)
31.36%  Dow Combo  
30.57%  Unemotional Value  
30.57%  Beating the Dow  
27.52%  Dogs of the Dow  
26.21%  Foolish Four  
25.70%  Beating the S&P  
24.60%  Dow Jones Ind Avg