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Micron Technology Reports An Outstanding Quarter And Provides Significantly Better Than Expected Guidance

|Includes: Arista Networks, Inc. (ANET), APO, AXTA, BTU, CREE, EXEL, FLS, JACK, MU, SYMC, TNET, UAA

This is an update to our model portfolio report, 35 Stocks for December 2017 

New Actions Required

  • Long Model: Close position in Peabody Energy Corp. (BTU) (price target).

Sell Side Upgrades and Downgrades Today

Also of Note

Return Data

For the MTD December, the Core Long Model is up +1.84% on a simple cumulative return basis (sum of daily returns). This compares to the S&P 500 up +1.28%, the Nasdaq up +1.32%, and the Russell 2000 down -0.44%.

The Core Long/Short Model is down -5.29%. The Opportunistic Long/Short Model, which assumed a 100% cash position in the short sale basket just prior to the close on December 8, is  down -3.88% MTD.

Presaging Major Sell Side Actions in December 2017

  • MTD nine stocks in the long model have received 12 positive price target revisions, and six stocks have received six ratings upgrades from sell side firms, led by Arista Networks (ANET) with four price target revisions.
  • MTD one stock in the short sale model has received a negative price target revision, and three stocks have received five ratings downgrades led by Flowserve (FLS) and Cree (CREE).

Latest Model Portfolio Stock Returns and Price Targets

Stock Selection Criteria

Our criteria for selecting stocks in these model portfolio strategies, which heavily weight proxies for cash flow growth and ROIC, include the following:

  • Relative Value
  • Operating Momentum
  • Consensus Estimate Revision Momentum
  • Fundamental Quality

We rebalance our model portfolios every month and have been tracking long-only and long/short unaudited theoretical daily returns since March 31, 2009. This theoretical return data does not make any assumption for costs such as execution fees, margin, slippage, or any other type of cost.

This return data, including more than two years of rolling 12-month return data for each model portfolio report that we have collected so far, is available on request.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Additional disclosure: As a simple quantitative model based on fundamental rankings, the portfolio models do not take into account rumors or pending M&A transactions. Theoretical return data do not assume the impact of costs such as execution fees, margin fees, slippage, the availability of stocks for short selling, or any other kind of cost. 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. We do our best to provide accurate information in this report, but do not guarantee its accuracy. DISCLOSURES Ascendere Associates LLC ("Ascendere") is in the business of providing equity research and related consulting services to retail investors, investment advisors, and hedge funds. The equity research it provides includes basic quantitative model portfolios and more detailed fundamental research with respect to individual stocks. Ascendere does not rate stocks on any scale, but does offer individual stock commentary and valuation opinions. With regard to Ascendere’s portfolio strategies, “long” or “high-quality” baskets should generally be considered buys, unless otherwise noted. Stocks in our “short” or “low-quality” baskets should generally be considered sells, unless otherwise noted. While exceptions may occasionally occur, typically stocks in the high-quality basket are expected to outperform the S&P 500 over a month’s time and stocks in the low-quality basket are expected to underperform. A more relevant benchmark would comprise of all stocks and ADRs that trade on major U.S. stock exchanges with a market cap above $2 billion. Ascendere adheres to professional standards and abides by codes of ethics that put the interests of clients ahead of its own. 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Investment decisions should be based on an individual’s own goals, time horizon and tolerance for risk. The information contained herein accurately reflects the opinion of Ascendere at the time the report was released. The opinions of Ascendere are subject to change at any time without notice and without obligation or notification. The officers, affiliates or family members of Ascendere Associates may hold positions in the securities of the Companies. No warranty is made as to the accuracy of the information contained herein. The views and opinions expressed in the market commentary reflect the opinions of the author and may be based upon information obtained from third-party sources believed to be reliable but not guaranteed. These opinions are subject to change at any time based upon market or other conditions. Ascendere disclaims any responsibility to update such views. This information is intended for the sole use of clients of Ascendere. 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