Thursday, December 18, 1997

The Daily Workshop Report
by Robert Sheard (TMF Sheard)

LEXINGTON, KY. (Dec. 18, 1997)

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

Of great interest in the Workshop message folder lately has been the possibility of testing a more concentrated version of Jim O'Shaughnessy's Cornerstone Growth approach. If you're unfamiliar with Jim's work, check out his two books: Invest Like the Best and What Works on Wall Street.

I haven't had time to run these screens for the full history of my database (1986 - 1997), but to whet your appetite, I used the following methodology for the 12/31/96 database:

Timeliness = 1 (This, of course, produced 100 stocks)

Price-to-Sales Ratio < 1.5 (This reduced the field to 28 stocks)

12-Month EPS % Change > 0 (This reduced the field to 26 stocks)

I sorted the remaining 26 stocks by the previous six months' returns (a measure of relative strength) and the top fifteen stocks and their 1997 returns through December 10 follow:

Western Digital <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: WDC)") else Response.Write("(NYSE: WDC)") end if %>            -39.34%
Herman Miller <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MLHR)") else Response.Write("(Nasdaq: MLHR)") end if %>            83.08%
Morningstar Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MSTR)") else Response.Write("(Nasdaq: MSTR)") end if %>   128.66%
Coachmen Inds. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: COA)") else Response.Write("(NYSE: COA)") end if %>            -20.51%
Gateway 2000 <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: GTW)") else Response.Write("(NYSE: GTW)") end if %>                15.75%
Revco <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: RXR)") else Response.Write("(NYSE: RXR)") end if %>                              18.31% **
Compaq Computer <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CPQ)") else Response.Write("(NYSE: CPQ)") end if %>        101.68%
Ross Stores <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ROST)") else Response.Write("(Nasdaq: ROST)") end if %>                  51.34%
Tultex <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TTX)") else Response.Write("(NYSE: TTX)") end if %>                               -33.03%
CKE Restaurants <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CKR)") else Response.Write("(NYSE: CKR)") end if %>              67.13%
TJX Cos. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TJX)") else Response.Write("(NYSE: TJX)") end if %>                            50.69%
Southdown <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SDW)") else Response.Write("(NYSE: SDW)") end if %>                      74.31%
Zeigler Coal <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ZEI)") else Response.Write("(NYSE: ZEI)") end if %>                       -17.41%
Mosinee Paper <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MOSI)") else Response.Write("(Nasdaq: MOSI)") end if %>              20.42%
Quality Food Centers <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: QFCI)") else Response.Write("(Nasdaq: QFCI)") end if %>     98.15%

** has since been bought out and no longer trades.

Top Five Stocks 33.53%

Top Ten Stocks 37.31%

Top Fifteen Stocks 39.95%

S&P 500 Index 32.96%

After the holidays, I will run similar screens for each year going back to 1986. I'll have to rely on readers, however, to fill in any gaps in return histories on stocks no longer included in the current database, either because Value Line has dropped them or because of merger activity.

Dont' forget that tomorrow afternoon, my column will include new rankings for the handful of screens we're currently tracking in the Workshop. Fool on!

Year-to-Date Returns
Monthly Growth Screens
68.86%  Relative Strength  
27.71%  S&P 500 Index  
12.84%  EPS Plus RS  
12.66%  Investing for Growth  
  3.87%  Formula 90  
 -0.87%  Unemotional Growth  
 -1.21%  YPEG Potential  
 -1.83%  Low Price/Sales  

Year-to-Date Returns
Annual Value Screens
30.42%  Beating the S&P  
25.76%  Foolish Four  
22.53%  Dow Combo  
21.68%  Dow Jones Ind Avg  
20.98%  Dogs of the Dow  
18.53%  Unemotional Value  
18.53%  Beating the Dow  

Have You Given? The Fool Charity Fund