From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #2424 Reply-To: canslim Sender: owner-canslim-digest@lists.xmission.com Errors-To: owner-canslim-digest@lists.xmission.com Precedence: bulk Content-Transfer-Encoding: quoted-printable X-No-Archive: yes canslim-digest Thursday, May 16 2002 Volume 02 : Number 2424 In this issue: Re: [CANSLIM] Off-topic: IRA question RE: TOO (was:[CANSLIM] WebLinks) Re: TOO (was:[CANSLIM] WebLinks) RE: TOO (was:[CANSLIM] WebLinks) RE: TOO (was:[CANSLIM] WebLinks) RE: [CANSLIM] Off-topic: IRA question RE: TOO (was:[CANSLIM] WebLinks) Re: TOO (was:[CANSLIM] WebLinks) ---------------------------------------------------------------------- Date: Thu, 16 May 2002 06:07:47 -0500 (CDT) From: "Robert Gammon" Subject: Re: [CANSLIM] Off-topic: IRA question See www.taxplanet.com This is maintained by a CPA/EA and is much more friendly than the IRS site. Robert On Wed, 15 May 2002 19:13:55 -0700 (PDT), Dave Cameron wrote: >This is off-topic, so delete if you want. > >I have a question. Part of my account is in a self-directed IRA. >Its been stagnant lately because my income exceeds the level where I >could deduct anything. I've been told the rules have changed for >2002. Can anyone point me to a site which gives the latest federal >regulations on this? > >Thanks. > > >===== >Dave Cameron >dfcameron@yahoo.com > >__________________________________________________ >Do You Yahoo!? >LAUNCH - Your Yahoo! Music Experience >http://launch.yahoo.com > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 16 May 2002 09:29:02 -0400 From: "Duke Miller" Subject: RE: TOO (was:[CANSLIM] WebLinks) This is a multi-part message in MIME format. - ------=_NextPart_000_0009_01C1FCBC.1DA09940 Content-Type: text/plain; charset="US-ASCII" Content-Transfer-Encoding: 7bit Can't tell you how many stocks I've passed on with over 50% institutional. Care to elaborate on your comment about S? Thanks Duke - -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com] On Behalf Of Tom Worley Sent: Wednesday, May 15, 2002 11:03 PM To: canslim@lists.xmission.com Subject: Re: TOO (was:[CANSLIM] WebLinks) Duke, not that many years ago, WON's exhortations to pick stocks with a few (but not many) institutional investors already holding it was the gospel. But that seems to have gone out the window along with the rules on "S" - ----- Original Message ----- From: Duke Miller To: canslim@lists.xmission.com Sent: Wednesday, May 15, 2002 11:00 PM Subject: RE: TOO (was:[CANSLIM] WebLinks) Thanks, Katherine, I just am guilty of interpreting WON too tightly, sometimes. His whole point (I thought) seems to be you got to get in before they do, lest you be subject to their whims, blah, blah... Duke - -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com] On Behalf Of Katherine Malm Sent: Wednesday, May 15, 2002 3:41 PM To: canslim@lists.xmission.com Subject: Re: TOO (was:[CANSLIM] WebLinks) Hi Duke, I see plenty of stocks doing well and/or setting up good bases that have lower institutional sponsorship. Unless the % is extraordinarily high, it doesn't bother me all that much. Afterall, CANSLIM is about riding on the coat tails of the big money, so no institutional money, no coat tails! Katherine - ----- Original Message ----- From: Duke Miller To: canslim@lists.xmission.com Sent: Wednesday, May 15, 2002 7:19 AM Subject: RE: TOO (was:[CANSLIM] WebLinks) So, Katherine, What's your take on the institutional domination of a lot of the better looking stocks (at least for now). Could it be these are in the limelight because it's the only place the institutions have been venturing into? Duke - -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com] On Behalf Of Katherine Malm Sent: Wednesday, May 15, 2002 2:03 AM To: canslim@lists.xmission.com Subject: Re: TOO (was:[CANSLIM] WebLinks) Hi Tom, I'm not surprised by the low management ownership, as it's common when a stock is a spin-off. (This, from LTD in Aug '99). While I know you much prefer companies still in the entrepreneurial stage with high mgmt ownership, spin-offs have a history of doing very well in most cases. Freedom from the mother-ship allows the new company to focus on their specific product/marketing niche. TOO seems pretty savvy at attacking the pre-teen girl niche. They have few competitors that serve the market as comprehensively. I don't remember exactly when, but TOO was added to the S&P Small Cap 600 recently. I remember at the time that there was a big runup in price in anticipation. Once it was officially added, the price took a hike South. The addition to the index may explain the fairly high institutional ownership. Katherine PS...Darn...was hoping the weblink was gone for good!! :)) I really HATE all those eyeballs.... - ------=_NextPart_000_0009_01C1FCBC.1DA09940 Content-Type: text/html; charset="US-ASCII" Content-Transfer-Encoding: quoted-printable Message
Can't tell you = how many=20 stocks I've passed on with over 50% institutional.  =
 
Care to = elaborate on your=20 comment about S?
 
Thanks
 
Duke
-----Original Message-----
From:=20 owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com]=20 On Behalf Of Tom Worley
Sent: Wednesday, May 15, 2002 = 11:03=20 PM
To: canslim@lists.xmission.com
Subject: Re: TOO = (was:[CANSLIM] WebLinks)

Duke, not that many years ago, WON's = exhortations to=20 pick stocks with a few (but not many) institutional investors already = holding=20 it was the gospel. But that seems to have gone out the window along = with the=20 rules on "S"
 
----- Original Message -----=20
From: Duke=20 Miller
Sent: Wednesday, May 15, 2002 11:00 PM
Subject: RE: TOO (was:[CANSLIM] WebLinks)

Thanks,=20 Katherine,
 
I just am = guilty of=20 interpreting WON too tightly, sometimes.  His whole point (I = thought)=20 seems to be you got to get in before they do, lest you be subject to = their=20 whims, blah, blah...
 
Duke
-----Original Message-----
From: owner-canslim@lists.xmis= sion.com=20 [mailto:owner-canslim@lists.xmission.com] On Behalf Of = Katherine=20 Malm
Sent: Wednesday, May 15, 2002 3:41 PM
To:=20 canslim@lists.xmission.com
Subject: Re: TOO (was:[CANSLIM] = WebLinks)

Hi Duke,
 
I see plenty of stocks doing well and/or setting up good bases = that=20 have lower institutional sponsorship. Unless the % is = extraordinarily high,=20 it doesn't bother me all that much. Afterall, CANSLIM is about = riding on the=20 coat tails of the big money, so no institutional money, no coat = tails!
 
Katherine
----- Original Message ----- =
From:=20 Duke Miller
To: canslim@lists.xmission.com= =20
Sent: Wednesday, May 15, = 2002 7:19=20 AM
Subject: RE: TOO = (was:[CANSLIM]=20 WebLinks)

So,=20 Katherine,
 
What's = your take on=20 the institutional domination of a lot of the better looking stocks = (at=20 least for now).  Could it be these are in the limelight = because it's=20 the only place the institutions have been venturing=20 into?
 
Duke
-----Original = Message-----
From: owner-canslim@lists.xmis= sion.com=20 [mailto:owner-canslim@lists.xmission.com] On Behalf Of = Katherine=20 Malm
Sent: Wednesday, May 15, 2002 2:03 = AM
To:=20 canslim@lists.xmission.com
Subject: Re: TOO = (was:[CANSLIM]=20 WebLinks)

Hi Tom,
 
I'm not surprised by the low management ownership, = as it's=20 common when a stock is a spin-off. (This,  from LTD in Aug = '99).=20 While I know you much prefer companies still in the = entrepreneurial=20 stage with high mgmt ownership, spin-offs have a history of = doing very=20 well in most cases. Freedom from the mother-ship allows the new = company=20 to focus on their specific product/marketing niche. TOO seems = pretty=20 savvy at attacking the pre-teen girl niche. They have few = competitors=20 that serve the market as comprehensively.
 
I don't remember exactly when, but TOO was added to the = S&P=20 Small Cap 600 recently. I remember at the time that there was a = big=20 runup in price in anticipation. Once it was officially added, = the price=20 took a hike South. The addition to the index may explain the = fairly high=20 institutional ownership.
 
Katherine
 
PS...Darn...was hoping the weblink was gone for good!! :)) = I really=20 HATE all those eyeballs....
=
 
- ------=_NextPart_000_0009_01C1FCBC.1DA09940-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 16 May 2002 09:38:10 -0400 From: "Tom Worley" Subject: Re: TOO (was:[CANSLIM] WebLinks) This is a multi-part message in MIME format. - ------=_NextPart_000_046E_01C1FCBD.646D7CC0 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable MessageThe chapter in HTMMIS on "S" is titled "S =3D Supply and Demand: = Small Capitalization plus Volume Demand" - that says it all - ----- Original Message -----=20 From: Duke Miller=20 To: canslim@lists.xmission.com=20 Sent: Thursday, May 16, 2002 9:29 AM Subject: RE: TOO (was:[CANSLIM] WebLinks) Can't tell you how many stocks I've passed on with over 50% = institutional. =20 Care to elaborate on your comment about S? Thanks Duke -----Original Message----- From: owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com] On Behalf Of Tom Worley Sent: Wednesday, May 15, 2002 11:03 PM To: canslim@lists.xmission.com Subject: Re: TOO (was:[CANSLIM] WebLinks) Duke, not that many years ago, WON's exhortations to pick stocks with = a few (but not many) institutional investors already holding it was the = gospel. But that seems to have gone out the window along with the rules = on "S" ----- Original Message -----=20 From: Duke Miller=20 To: canslim@lists.xmission.com=20 Sent: Wednesday, May 15, 2002 11:00 PM Subject: RE: TOO (was:[CANSLIM] WebLinks) Thanks, Katherine, I just am guilty of interpreting WON too tightly, sometimes. His = whole point (I thought) seems to be you got to get in before they do, = lest you be subject to their whims, blah, blah... Duke -----Original Message----- From: owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com] On Behalf Of Katherine Malm Sent: Wednesday, May 15, 2002 3:41 PM To: canslim@lists.xmission.com Subject: Re: TOO (was:[CANSLIM] WebLinks) Hi Duke, I see plenty of stocks doing well and/or setting up good bases that = have lower institutional sponsorship. Unless the % is extraordinarily = high, it doesn't bother me all that much. Afterall, CANSLIM is about = riding on the coat tails of the big money, so no institutional money, no = coat tails! Katherine ----- Original Message -----=20 From: Duke Miller=20 To: canslim@lists.xmission.com=20 Sent: Wednesday, May 15, 2002 7:19 AM Subject: RE: TOO (was:[CANSLIM] WebLinks) So, Katherine, What's your take on the institutional domination of a lot of the = better looking stocks (at least for now). Could it be these are in the = limelight because it's the only place the institutions have been = venturing into? Duke -----Original Message----- From: owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com] On Behalf Of Katherine Malm Sent: Wednesday, May 15, 2002 2:03 AM To: canslim@lists.xmission.com Subject: Re: TOO (was:[CANSLIM] WebLinks) Hi Tom, I'm not surprised by the low management ownership, as it's = common when a stock is a spin-off. (This, from LTD in Aug '99). While I = know you much prefer companies still in the entrepreneurial stage with = high mgmt ownership, spin-offs have a history of doing very well in most = cases. Freedom from the mother-ship allows the new company to focus on = their specific product/marketing niche. TOO seems pretty savvy at = attacking the pre-teen girl niche. They have few competitors that serve = the market as comprehensively. I don't remember exactly when, but TOO was added to the S&P = Small Cap 600 recently. I remember at the time that there was a big = runup in price in anticipation. Once it was officially added, the price = took a hike South. The addition to the index may explain the fairly high = institutional ownership. Katherine PS...Darn...was hoping the weblink was gone for good!! :)) I = really HATE all those eyeballs.... - ------=_NextPart_000_046E_01C1FCBD.646D7CC0 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Message
The chapter in HTMMIS on "S" is titled "S =3D = Supply and=20 Demand: Small Capitalization plus Volume Demand" - that says it = all
 
----- Original Message -----=20
From: Duke=20 Miller
Sent: Thursday, May 16, 2002 9:29 AM
Subject: RE: TOO (was:[CANSLIM] WebLinks)

Can't tell you = how many=20 stocks I've passed on with over 50% institutional.  =
 
Care to = elaborate on your=20 comment about S?
 
Thanks
 
Duke
-----Original Message-----
From: owner-canslim@lists.xmis= sion.com=20 [mailto:owner-canslim@lists.xmission.com] On Behalf Of Tom=20 Worley
Sent: Wednesday, May 15, 2002 11:03 PM
To: = canslim@lists.xmission.com=
Subject:=20 Re: TOO (was:[CANSLIM] WebLinks)

Duke, not that many years ago, WON's = exhortations to=20 pick stocks with a few (but not many) institutional investors already = holding=20 it was the gospel. But that seems to have gone out the window along = with the=20 rules on "S"
 
----- Original Message -----=20
From: Duke=20 Miller
Sent: Wednesday, May 15, 2002 11:00 PM
Subject: RE: TOO (was:[CANSLIM] WebLinks)

Thanks,=20 Katherine,
 
I just am = guilty of=20 interpreting WON too tightly, sometimes.  His whole point (I = thought)=20 seems to be you got to get in before they do, lest you be subject to = their=20 whims, blah, blah...
 
Duke
-----Original Message-----
From: owner-canslim@lists.xmis= sion.com=20 [mailto:owner-canslim@lists.xmission.com] On Behalf Of = Katherine=20 Malm
Sent: Wednesday, May 15, 2002 3:41 PM
To:=20 canslim@lists.xmission.com
Subject: Re: TOO (was:[CANSLIM] = WebLinks)

Hi Duke,
 
I see plenty of stocks doing well and/or setting up good bases = that=20 have lower institutional sponsorship. Unless the % is = extraordinarily high,=20 it doesn't bother me all that much. Afterall, CANSLIM is about = riding on the=20 coat tails of the big money, so no institutional money, no coat = tails!
 
Katherine
----- Original Message ----- =
From:=20 Duke Miller
To: canslim@lists.xmission.com= =20
Sent: Wednesday, May 15, = 2002 7:19=20 AM
Subject: RE: TOO = (was:[CANSLIM]=20 WebLinks)

So,=20 Katherine,
 
What's = your take on=20 the institutional domination of a lot of the better looking stocks = (at=20 least for now).  Could it be these are in the limelight = because it's=20 the only place the institutions have been venturing=20 into?
 
Duke
-----Original = Message-----
From: owner-canslim@lists.xmis= sion.com=20 [mailto:owner-canslim@lists.xmission.com] On Behalf Of = Katherine=20 Malm
Sent: Wednesday, May 15, 2002 2:03 = AM
To:=20 canslim@lists.xmission.com
Subject: Re: TOO = (was:[CANSLIM]=20 WebLinks)

Hi Tom,
 
I'm not surprised by the low management ownership, = as it's=20 common when a stock is a spin-off. (This,  from LTD in Aug = '99).=20 While I know you much prefer companies still in the = entrepreneurial=20 stage with high mgmt ownership, spin-offs have a history of = doing very=20 well in most cases. Freedom from the mother-ship allows the new = company=20 to focus on their specific product/marketing niche. TOO seems = pretty=20 savvy at attacking the pre-teen girl niche. They have few = competitors=20 that serve the market as comprehensively.
 
I don't remember exactly when, but TOO was added to the = S&P=20 Small Cap 600 recently. I remember at the time that there was a = big=20 runup in price in anticipation. Once it was officially added, = the price=20 took a hike South. The addition to the index may explain the = fairly high=20 institutional ownership.
 
Katherine
 
PS...Darn...was hoping the weblink was gone for good!! :)) = I really=20 HATE all those eyeballs....
=
 
- ------=_NextPart_000_046E_01C1FCBD.646D7CC0-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 16 May 2002 07:47:27 -0600 From: "Patrick Wahl" Subject: RE: TOO (was:[CANSLIM] WebLinks) I didn't make the original comment, but a few years ago O'Neil said something about relaxing that rule because there was enough money sloshing around out there, in the form of mutual funds, to move even the large stcoks. The original idea I think was that it was too hard to move big stocks up very much, but that changed with all of the index fund money. He also said to look and see what is working (nothing wrong with adjusting things and not being locked into a single idea regardless of what the market is doing), and right now it seems to be small and mid cap stocks again. Just saw a chart of the S&P 600, which is mid cap stuff, and it is near a high. On 16 May 2002 at 9:29, Duke Miller wrote: > Care to elaborate on your comment about S? - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 16 May 2002 11:09:11 -0400 From: "Duke Miller" Subject: RE: TOO (was:[CANSLIM] WebLinks) Thanks Patrick and Tom. I'm narrowing my MUST criteria more as time goes on. Got any darts you want to sell me!?!? Duke - -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com] On Behalf Of Patrick Wahl Sent: Thursday, May 16, 2002 9:47 AM To: canslim@lists.xmission.com Subject: RE: TOO (was:[CANSLIM] WebLinks) I didn't make the original comment, but a few years ago O'Neil said something about relaxing that rule because there was enough money sloshing around out there, in the form of mutual funds, to move even the large stcoks. The original idea I think was that it was too hard to move big stocks up very much, but that changed with all of the index fund money. He also said to look and see what is working (nothing wrong with adjusting things and not being locked into a single idea regardless of what the market is doing), and right now it seems to be small and mid cap stocks again. Just saw a chart of the S&P 600, which is mid cap stuff, and it is near a high. On 16 May 2002 at 9:29, Duke Miller wrote: > Care to elaborate on your comment about S? - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 16 May 2002 10:13:29 -0500 From: "Edward W. Gjertsen II" Subject: RE: [CANSLIM] Off-topic: IRA question Hi Dave, IRA's are always deductible, regardless of income - UNLESS - you or your spouse are an active participant in a company's retirement plan. If you are an active participant, there are thresholds of deductibility at certain Adjusted Gross Income levels. Hope this helps. Ed Gjertsen II, CFP ed@macktracks.com - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 16 May 2002 09:33:29 -0600 From: "Patrick Wahl" Subject: RE: TOO (was:[CANSLIM] WebLinks) It is a little hard sometimes, and as has been mentioned, most people practice some modified form of CANSLIM. I've tried to see what the underlying idea is to the whole thing, and I think it gets down to a few things that make sense to me - - -You want to time your buy so you get in when a stock is making a move, and you have a reasonable risk point if you are wrong. - -You are looking for strong growth companies. - -You are looking for something new, something that is a catalyst for strong and hopefully sustained growth in a company, like a new product, a new industry (see the internet, or the networking market of the early nineties as new industries). All the other stuff is somewhat peripheral, I think, guess there is room for argument there, but basically you want growth (a company executing well) and a company in a growing industry (the old expanding pie idea). I guess I like the letters CANLM the best. On 16 May 2002 at 11:09, Duke Miller wrote: > Thanks Patrick and Tom. > > I'm narrowing my MUST criteria more as time goes on. Got any darts you > want to sell me!?!? > - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 16 May 2002 11:29:26 -0500 From: "Katherine Malm" Subject: Re: TOO (was:[CANSLIM] WebLinks) This is a multi-part message in MIME format. - ------=_NextPart_000_0037_01C1FCCC.EF6E5D80 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Patrick, You've been reading my mind!! Couldn't agree with you more. Since really = spending time getting to the heart of CANSLIM, I concluded that = technical strength combined with minimum growth characteristics and an = identifiable strategic advantage are the most important aspects. Here's = how I go about finding the candidates in more specific terms: "Must Have" =3D=3D=3D=3D=3D=3D=3D=3D=3D Minimum Technicals: RS>=3D60 and <70 + RS rising--minimum starting point for watch list RS>=3D70 (min at purchase) Price >=3D -15% of 50dMA Price >=3D 200 dMA A/D =3D A, B, C (prefer A or B on purchase) Minimum Fundamentals: Forward growth rate >=3D15 Expected return based on Current Price, past profitability & EPS = estimates >=3D return on AAA bonds (this from VectorVest, RV>=3D1 and a = simple measure of risk/reward) Cash Flow positive "N" =3D identifiable strategic advantage that makes the stock and/or the = industry a "L"eader with fuel for future growth The last two can't be easily filtered, so require due diligence. (Cash = flow is unreliable in stock screeners because you don't always know = whether they are using fiscal, trailing 12 months, prior reported year, = etc.) Sound technical pattern on break out and/or pullback entry. "Sorting/Elimination/Preference Criteria" =3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D= =3D=3D Operating Cash flow nearly equal to EPS (a quick way to identify = accounting red flags) EPS and Revs growing (prefer >=3D20%, if a turnaround, at least 2 = quarters of growth) ROE (prefer >=3D17%) D/E (prefer <=3D50%) % Institutional ownership (prefer 10-40%) At least one other stock that is a direct competitor or is in the same = industry is also in similar technical shape (only exception is when the = company's product/market is so unique that there is no obvious publicly = traded competitor ) General industry strength (prefer the same RS requirements as with the = stock--This acts more as a "draw your eye to strength" indicator for the = above condition) These last items I don't filter for, but the more of the minimums the = stock meets, the more "points" the stock gets. All else being equal in = the "must haves", this sorts the cream to the top of the list. Katherine ----- Original Message -----=20 From: Patrick Wahl=20 To: canslim@lists.xmission.com=20 Sent: Thursday, May 16, 2002 10:33 AM Subject: RE: TOO (was:[CANSLIM] WebLinks) It is a little hard sometimes, and as has been mentioned, most people = practice=20 some modified form of CANSLIM. I've tried to see what the underlying = idea is to=20 the whole thing, and I think it gets down to a few things that make = sense to me - -You want to time your buy so you get in when a stock is making a = move, and you=20 have a reasonable risk point if you are wrong. -You are looking for strong growth companies. -You are looking for something new, something that is a catalyst for = strong and=20 hopefully sustained growth in a company, like a new product, a new = industry (see=20 the internet, or the networking market of the early nineties as new = industries). All the other stuff is somewhat peripheral, I think, guess there is = room for argument=20 there, but basically you want growth (a company executing well) and a = company in=20 a growing industry (the old expanding pie idea). I guess I like the = letters CANLM the=20 best. On 16 May 2002 at 11:09, Duke Miller wrote: > Thanks Patrick and Tom. >=20 > I'm narrowing my MUST criteria more as time goes on. Got any darts = you > want to sell me!?!? - ------=_NextPart_000_0037_01C1FCCC.EF6E5D80 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Patrick,
 
You've been reading my mind!! Couldn't agree with you more. Since = really=20 spending time getting to the heart of CANSLIM, I concluded that = technical=20 strength combined with minimum growth characteristics and an = identifiable=20 strategic advantage are the most important aspects. Here's how I go = about=20 finding the candidates in more specific terms:
 
"Must Have"
=3D=3D=3D=3D=3D=3D=3D=3D=3D
Minimum Technicals:
RS>=3D60 and <70 + RS rising--minimum starting point for = watch=20 list
RS>=3D70 (min at purchase)
Price >=3D -15% of 50dMA
Price >=3D 200 dMA
A/D =3D A, B, C (prefer A or B on purchase)
Minimum Fundamentals:
Forward growth rate >=3D15
Expected return based on Current Price, past profitability & = EPS=20 estimates >=3D return on AAA bonds (this from VectorVest, RV>=3D1 = and a simple=20 measure of risk/reward)
Cash Flow positive
"N" =3D identifiable strategic advantage that makes the stock = and/or the=20 industry a "L"eader with fuel for future growth
The last two can't be easily filtered, so require due diligence. = (Cash flow=20 is unreliable in stock screeners because you don't always know whether = they are=20 using fiscal, trailing 12 months, prior reported year, etc.)
Sound technical pattern on break out and/or pullback entry.
 
"Sorting/Elimination/Preference Criteria"
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D= =3D=3D=3D=3D
Operating Cash flow nearly equal to EPS (a quick way to identify = accounting=20 red flags)
EPS and Revs growing (prefer >=3D20%, if a turnaround, at least = 2 quarters=20 of growth)
ROE (prefer >=3D17%)
D/E (prefer <=3D50%)
% Institutional ownership (prefer 10-40%)
At least one other stock that is a direct competitor or is in the = same=20 industry is also in similar technical shape (only exception is when the=20 company's product/market is so unique that there is no obvious publicly = traded=20 competitor )
General industry strength (prefer the same RS requirements as with = the=20 stock--This acts more as a "draw your eye to strength" indicator for the = above=20 condition)
These last items I don't filter for, but the more of the minimums = the stock=20 meets, the more "points" the stock gets. All else being equal in the = "must=20 haves", this sorts the cream to the top of the list.
 
Katherine
----- Original Message -----
From:=20 Patrick = Wahl=20
Sent: Thursday, May 16, 2002 = 10:33=20 AM
Subject: RE: TOO (was:[CANSLIM] = WebLinks)

It is a little hard sometimes, and as has been = mentioned, most=20 people practice
some modified form of CANSLIM.  I've tried to = see=20 what the underlying idea is to
the whole thing, and I think it = gets down=20 to a few things that make sense to me -

-You want to time your = buy so=20 you get in when a stock is making a move, and you
have a = reasonable risk=20 point if you are wrong.
-You are looking for strong growth=20 companies.
-You are looking for something new, something that is a = catalyst=20 for strong and
hopefully sustained growth in a company, like a new = product, a new industry (see
the internet, or the networking = market of the=20 early nineties as new industries).

All the other stuff is = somewhat=20 peripheral, I think, guess there is room for argument
there, but = basically=20 you want growth (a company executing well) and a company in
a = growing=20 industry (the old expanding pie idea).  I guess I like the = letters CANLM=20 the
best.

On 16 May 2002 at 11:09, Duke Miller = wrote:

>=20 Thanks Patrick and Tom.
>
> I'm narrowing my MUST = criteria more=20 as time goes on.  Got any darts you
> want to sell=20 me!?!?
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