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By: Giorgio Ferrero

It's taken me a while to understand a novice level of programming in "R." Fortunately, I have learned how to use a code that pulls the prices for any ticker (or tickers) I want during a specified time period. This code has given me the ability to look at the returns of 1-10,000 stocks in a fraction of the time I used to spend on just 10 stocks. Tonight I present to you the top stocks performing stocks for the S&P500 for the past 9 years from March to May option expiration. Now I did not analyze all the stocks in the S&P500. I first built my ticker list using the screener tool at Finviz.com. The criteria I used to was the following:

1. EPS growth for past 5 years: over 5%

2. EPS growth expected for next 5 years: over 5%

3. Average volume: over 1 million

4. All stocks from S&P500

Once I exported the ticker list of 223 companies I factored out all the stocks that did not have a full 9 years of price data.

I further marginalized my search by finding all the tickers that had a -3% or less drawdown during March-May option expiration

The summary of my results are as follows. I studied CH Robinson (CHRW), CSX (CSX), Danaher (DHR), Edwards Lifesciences (EW), Fluor (FLR), Heinz (HNZ), Thermo Fisher (TMO), and Yum! Brands (YUM).

(Click to enlarge)

We are now looking at the best performing stocks in the S&P500 for the past 9 years from March to May option expiration that filtered through my screener.

I have included my estimated max up down price points in the bottom row as reference for us to trade bull put/bear call spreads on the tickers listed above. Based on these 9yr best/worst returns I have estimated the max high/low price of each stock for May'18th. This is not to be understood as to where I think the stock will go by May'18 but instead where I think the stock will not go by May'18. In order for any of these stocks to reach my estimated max high/low prices on May'18th investors would have to show an unprecedented about of buying/selling to break the 9yr max return range.

Notice how all of these stocks have very high max returns relative to their worst returns. TMO has never seen a negative return during March to May since 2002; instead its worst return has been a positive 2%!

Although looking at the worst return is very appealing it's also important to know how many times since 2002 that the stocks increased/decreased in value.

The histogram below shows the % of times the securities increased in value from Mar-May option expiration since 2002.

Based on the data above I suggest the following trades:

Suggested Trade 1: Thermo Fisher Scientific, Inc.

(Click to enlarge)

Suggested Trade: TMO - Sell May'18 55/50 put spread (Bull Put Spread)

(Sell 55 Put/Buy 50 Put)

Size - 10% of Giorgio's Corner Portfolio Size = (2 spreads)

Entry: Sell Limit: 0.40 (the spread is not currently trading at 0.40 so you may enter it for a much better price around 0.55)

Stop Loss: 1.70

Exit Price: 0.00

Max Return: 8.69%

(Note: Return calculation does not include commission; Max Return is calculated as Return at Risk not Return on Margin)

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Suggested Trade 2: Edward Lifesciences Corp.

(Click to enlarge)

Suggested Trade: EW - Sell May'18 65/60 put spread (Bull Put Spread)

(Sell 65 Put/Buy 60 Put)

Size - 10% of Giorgio's Corner Portfolio Size = (2 spreads)

Entry: Sell Limit: 0.45

Stop Loss: 1.70

Exit Price: 0.00

Max Return: 9.89%

(Note: Return calculation does not include commission; Max Return is calculated as Return at Risk not Return on Margin)

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Suggested Trade 3: CH Robinson Worldwide Inc.

(Click to enlarge)

Suggested Trade: CHRW - Sell May'18 62.50/60 put spread (Bull Put Spread)

(Sell 62.50 Put/Buy 60 Put)

Size - 7.5% of Giorgio's Corner Portfolio Size = (3 spreads)

Entry: Sell Limit: 0.50

Stop Loss: 1.40

Exit Price: 0.00

Max Return: 25%

(Note: Return calculation does not include commission; Max Return is calculated as Return at Risk not Return on Margin)

Disclosure: I do not own any investments in CHRW, CSX, DHR, EW, FLR, HNZ, TMO, or YUM. I own long shares of BIDU. I'm short shares of UVXY, GLL, GOOG and ZSL. I own bear call spreads on SPY, VXX, GLL, and ZSL. I am long TMO. Charts are from Finviz.com.

Source: The Best Performing S&P 500 Stocks March Through May