Celebrating 10 Years of Favorites
Cover Story, by Mark Robertson, Managing Partner October 1st, 2015
In the October 2005 issue, we launched the MANIFEST 40, built from the stocks that most frequently appear on subscriber dashboards, and this tracking dashboard has delivered a rate of return of 8.8% since inception.
Achieving Peak Performance. It’s been the theme of the MANIFEST 40 since that first collection was published ten years ago. By discovering the best companies while investing with your friends, we believe that we all have a leg up on the “average investor.” The performance observed over the last ten years validates our hopes and expectations.
In the October 2005 issue, we launched the MANIFEST 40, built from the stocks that most frequently appear on subscriber dashboards. As such, it’s something of a barometer because we know that these community favorites are not simply followed … most of them are also widely owned, with considerable diligence and vigilance. Bottom line? This tracking dashboard has delivered a rate of return (since inception) of 8.8%. On an annualized basis, your community favorites have beaten the Wilshire 5000 by +3.5 percentage points — a relative return that nurtures smiles and bolsters the returns of our actual portfolios.
“We have always believed that the collective decisions made by our community of long-term investors is worth huddling over … a place where ideas are born.”
A couple of our favorite words are (1) actionable and (2) formidable.
And when they meet, they combine to form something powerful and valuable to long-term investors. Actionable ideas that take shape based on the lessons of group-centered investing dating back to — and deploying — lessons learned since 1940 become a formidable resource.
The Joys of A Good Huddle. It’s more than a mantra. From the onset, we expected that ideas born in consensus with a like-minded community have considerable potential. We have not been disappointed.
From the core contribution of stalwarts like Microsoft (MSFT), Johnson & Johnson (JNJ), AFLAC (AFL), General Electric (GE) and Stryker (SYK) to the high octane boost from Apple (AAPL), Cognizant Technology (CTSH) and FactSet Research (FDS) … the returns have been collectively strong. There have also been companies like Bio-Reference Labs (BRLI), relatively obscure from the radar screens of “average investors” but a solid contributor amongst our portfolios until the recent acquisition by Opko Health.
As the average sales growth forecast of the portfolio (6.9%) suggests — it is dominated by the “Up, Straight and Parallel” contributors but also welcoming to the likes of PRA Group and Gilead Sciences.
Overall Quality (90) is rarely in question and the overall return forecast (8.6%) has consistently been positioned to outperform the Wilshire 5000. We’d like to see the community discover and deploy some of the smaller, faster-growing companies we’ll be discovering during 4Q2015 and again, it’s unlikely we’ll be disappointed.
Performance Results
This managed “tracking portfolio” of your collective favorites has outperformed the Wilshire 5000 by +3.5%. The absolute rate of return for the trailing 10 years is 8.8%.
Our MANIFEST 40 is a celebration of collective excellence in stock selection, strategy and disciplined patience. We continuously monitor the 40 most-widely followed stocks by our community of subscribers at Manifest Investing. We think it’s more than a fair assumption that many of these are in your real money portfolios … and for that, we’re optimistic and grateful.
MANIFEST 40 (September 2015). These are the most widely followed stocks by Manifest Investing subscribers. Current leader Apple (AAPL) was added on 9/24/2009 and steadily climbed the ranks while generating a relative return of +22.9% (annualized) since then. Figures in parentheses are the ranking back in June 2015. The average annualized relative return of the stocks in the current dashboard is +4.8% and the average holding period is 6.3 years. Companies with 10 years are “charter members” of the tracking portfolio.
Capturing Attention: Chargers
Fastenal (FAST) moved from #7 to #5 and continues to attract interest despite the current economic challenges. This was among the largest moves among the top ten.
Gilead Sciences (GILD) has steadilt drawn more attention, rising from #36 to #29 as optimism swells about the progress made by the company as it develops solutions to some pervasive healthcare challenges.
Recent Solomon Select feature T. Rowe Price (TROW) made a modest move up the list as our community has paid some attention to relatively attractive situations with a number of the asset management firms.
The results of $100 positions investing in any of the Top 40 companies can be viewed at any time at:
http://www.manifestinvesting.com/dashboards/public/manifest-40
LKQ Corp (LKQ): Chronicle. The return forecasts for this automobile collision-based business have reached levels not seen often during the last few years, probably accounting for some of the surge in interest for this quarterly update’s newcomer.
Newcomer
LKQ Corp (LKQ) replaced Bio-Reference Labs (BRLI) in the MANIFEST 40 during this update.
Strongest Performers
Home Depot (HD), Starbucks (SBUX) and Lowe’s (LOW) have contributed mightily over the last year while Apple, Cognizant and FactSet continued their long term support.
We’ll continue to pay the most attention to these community favorites. Keep up the good hunting! Peak at will.
Mark Robertson
Mark Robertson is founder and managing partner of Manifest Investing, a source for research and portfolio management focusing on strategic long term investors.