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I seek to liberate investors from the chains of borrowed opinions by teaching metric awareness that leads to the formation of your own opinions. I lack the usual attributes that qualifies me to write on investing. I am a retail investor. But I do gather, process and analyze significantly more... More
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  • Historical EPS Projection Accuracy - Consumer Staples 0 comments
    Mar 19, 2014 2:14 PM

    My recent article that included data on FFO projection accuracy caused some curiosity on "earning projection accuracy" in other sectors - and how that metric influences RRRs. Here is the data on my "grocery list" portfolio.

    You can see how low accuracy for ADM and INGR results in those two having a higher "yield + CAGR". And having a higher "yield + CAGR" implies that they have higher RRRs (or required rates of return).

    Changes in EPS estimates by Year:
    Some Companies Have Assets That Produce More Predictable EPS Projections
     2010201120122013Accuracy14 EPS
    compBeginningEndingChangeBeginningEndingChangeBeginningEndingChangeBeginningCurChangeRatingSpread

    ADM2.803.069.3%2.913.4719.2%2.972.30-22.6%3.112.33-25.1%3.520%
    CPB2.472.470.0%2.512.541.2%2.372.443.0%2.542.643.9%1.03%
    KO1.721.751.7%1.921.920.0%2.072.01-2.9%2.192.08-5.0%1.217%
    CAG1.751.74-0.6%1.751.750.0%1.811.841.7%2.082.163.8%1.02%
    CL2.422.420.0%2.532.52-0.4%2.762.68-2.9%2.952.84-3.7%1.07%
    INGR2.523.2428.6%3.624.6829.3%5.115.579.0%5.875.05-14.0%2.06%
    CLX3.944.247.6%4.153.93-5.3%4.084.100.5%4.314.310.0%1.54%
    FLO0.710.66-7.0%0.740.64-13.5%0.730.69-5.5%0.770.9118.2%3.07%
    GIS2.302.300.0%2.482.480.0%2.602.56-1.5%2.682.690.4%1.04%
    HSY2.302.5510.9%2.762.822.2%3.123.243.8%3.553.724.8%1.03%
    HRL1.311.5115.3%1.591.749.4%1.821.862.2%1.941.971.5%1.06%
    K3.623.30-8.8%3.463.38-2.3%3.523.612.6%3.633.773.9%2.09%
    KMB5.174.68-9.5%5.014.80-4.2%5.255.250.0%5.595.773.2%2.04%
    LANC3.784.077.7%3.643.845.5%3.833.45-9.9%4.033.98-1.2%2.03%
    MKC2.522.655.2%2.812.79-0.7%3.103.04-1.9%3.363.13-6.8%1.83%
    PEP4.174.13-1.0%4.614.40-4.6%4.604.10-10.9%4.414.37-0.9%2.01%
    PG4.144.11-0.7%3.983.95-0.8%4.193.85-8.1%3.964.052.3%1.22%
    SJM4.064.357.1%4.664.813.2%5.024.73-5.8%5.215.373.1%1.21%

    Total Return Expectations


    CoYieldCAGRTotal Rtn

    ADM1.79%9.00%10.79%
    CPB2.63%6.50%9.13%
    KO2.93%6.50%9.43%
    CAG3.40%7.50%10.90%
    CL2.13%7.80%9.93%
    INGR2.30%9.10%11.40%
    CLX2.93%7.00%9.93%
    FLO2.14%9.50%11.64%
    GIS2.65%7.70%10.35%
    HSY1.58%9.50%11.08%
    HRL1.44%9.90%11.34%
    K2.89%7.00%9.89%
    KMB2.95%7.00%9.95%
    LANC1.68%9.00%10.68%
    MKC2.01%8.50%10.51%
    PEP2.80%6.50%9.30%
    PG3.05%7.50%10.55%
    SJM2.16%7.50%9.66%

    Average2.42%7.94%10.36%

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