Recap from November Picks

Our Most Attractive Stocks (-2.4%) underperformed the S&P 500 (-1.1%) last month. Most Attractive Large Cap stock Goodyear Tire & Rubber (GT) gained 6% and Most Attractive Small Cap stock Orbotech (ORBK) was up 24%. Overall, 18 out of the 40 Most Attractive stocks outperformed the S&P 500 in November.

Our Most Dangerous Stocks (+0.4%) underperformed the S&P 500 (-1.1%) last month. Most Dangerous Large Cap stock Macquarie Infrastructure (MIC) fell by 5% and Most Dangerous Small Cap Stock Astrotech Corporation (ASTC) fell by 13%. Overall, 15 out of the 40 Most Dangerous stocks outperformed the S&P 500 in November.

The successes of the Most Attractive and Most Dangerous stocks highlight the value of our forensic accounting. Being a true value investor is an increasingly difficult, if not impossible, task considering the amount of data contained in the ever-longer annual reports. By analyzing key details in these SEC filings, our research protects investors’ portfolios and allows our clients to execute value-investing strategies with more confidence and integrity.

21 new stocks make our Most Attractive list and 32 new stocks fall onto the Most Dangerous list this month. December’s Most Attractive & Most Dangerous stocks were made available to members on December 3, 2015.

Our Most Attractive stocks have high and rising return on invested capital (ROIC) and low price to economic book value ratios. Most Dangerous stocks have misleading earnings and long growth appreciation periods implied by their market valuations.

Most Attractive Stock Feature for December: Gentex Corp (GNTX: $16/share)

Gentex Corp (GNTX), automobile parts supplier, is one of the additions to our Most Attractive List for December.

Gentex has built a dominant (90% market share in 2014), and more importantly, highly profitable business supplying automatic dimming rearview mirrors and electronics to the automotive industry. Since the industry crashed in 2008, Gentex has grown after-tax profit (NOPAT) by 24% compounded annually. This impressive profit growth can be seen in Figure 1.