December 2016 Price Targets

Dec. 05, 2016 6:14 PM ETMETA, P
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Long/Short Equity, Growth At A Reasonable Price

Contributor Since 2009

J. Stephen Castellano founded the equity research and financial modeling consulting firm Ascendere Associates in 2009, building upon a diversified 20-year career in sell side and buy side equity research. His roles included coverage of the steel industry at PaineWebber and telecom services at Warburg Dillon Read (the predecessors to UBS), where he worked closely with institutional sales people, traders and investment bankers. In addition, he provided analytical support for numerous independent valuation, consulting and investment banking studies, including for mergers, secondary offerings and IPOs. At Ascendere Associates, in addition to developing equity research for family offices and other clients, he has consulted for a wide range of startups, established businesses, and global consulting firms. Mr. Castellano holds a B.A. in English from Oberlin College, an MBA from the F.W. Olin School of Business at Babson College, and has passed the first two levels of the CFA exam.

This is an update to our model portfolio report, 28 Stocks for December 2016.

The tables below show price targets and return data for the latest theoretical model portfolios.

As indicated, stock in the theoretical short model portfolios has already hit a stop loss and was assumed closed at the end of trading today - Pandora Media (P).

Facebook, Inc. (FB) is our favorite long stock idea for December 2016. As we illustrate in our model portfolio report, the company seems poised to generate a surge of earnings and ROIC for 2017.

On average, stocks in our models tend to work well as long-term ideas. We track one-year returns of each year-end model portfolio, and one-month of each newly model portfolio that is rebalanced monthly.

December is already off to a good start, with high-quality stocks moving up on average and low-quality stocks moving down on average, generating positive returns for associated long/short strategies.

Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in OR SHORT over the next 72 hours.

Additional disclosure: There are limitations inherent in our theoretical model results, particularly with the fact that such results do not represent actual trading and they may not reflect the impact material economic and market factors might have had on our decision making if we were actually managing client money.

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