Commence Sharing of Actionable Ideas

Stock Screen, by Mark Robertson, Managing Partner November 1st, 2019

During the month of October, we carefully search for small company ideas for the next year’s Best Small Companies list.

At Manifest Investing, we are co-sponsors and producers of our monthly webcasts known as the Investing Round Table. The agenda usually includes a review of screening results by one or more of the participants in our quest for actionable ideas to study. During the October 2019 Round Table, the emphasis and focus was on faster-growing companies with excellent quality characteristics.

During the month of October, we carefully search for small company ideas for the next year’s Best Small Companies list. The hunt is for smaller, faster-growing companies that rank among the upper percentiles of quality companies that exhibit double-digit growth rate forecasts. The primary screening criteria are:

(1) Quality Rank > 60 (Excellent & Good Companies)
(2) Growth Forecast > 10%

This is combined with our traditional parade of opinions that range from oversold technical factors, to stock prices near 52-week lows, to superior return forecasts and attractive price-to-fair value ratios and a dash of expectations for the year ahead.

We’ve circled the best and highest ranked conditions among the parade of characteristics and opinion shown in the accompanying figure.

The Round Table audience selected BioSpecifics Technologies (BSTC) as a promising company in the realm of reducing collagen that happens to garner the most circles as shown in the accompanying chart. Caveat emptor as this selection (BSTC) is a very small company with $36 million in trailing 12-month sales. Forrester Research (FORR) has been a community favorite in the past and merits current consideration. Pacira Pharma (PCRX) is focused on driving improved patient outcomes with opioid-reducing strategies. That seems necessary and timely … we’ll hope for success in their endeavors.

Manifest Investing: Median Return Forecast. The storm that was December or 4th Quarter 2018 has given way to a return to new highs and a median projected annual return (PAR) of 9.0%, closer to historical norms.

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.