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Continued Outperformance for Blue Harbinger Stocks

All three Blue Harbinger strategies continue to outperform. This week’s Weekly reviews the performance of the individual holdings within each strategy, and we focus on several stocks in particular that we believe provide terrific buying opportunities right now.  And just for grins, here is a fun quote from Charlie Munger.

Here are the holdings (and year-to-date performance) of our Disciplined Growth strategy:

As the table shows, the strategy is outperforming by over 2% so far this year.  However, American Express and Paylocity have been big laggards.  American Express declined drastically earlier this year when it announced a 38% decline in fourth quarter earnings, and provided lower than expect future (2017) guidance.  We believe American Express was using this as their “big bath,” whereby they posted all the bad news at once (to get it out of the way), and there is more upside ahead.  We especially like that the company is cutting $1 billion in growth initiative spending as they’ve realized it hasn’t been boosting business much.  You can read more of our updates on American Express here.

With regards to Paylocity, it’s just a very volatile small cap stock.  We’re not concerned with the decline so far this year, as the stock had a great 2015, and we believe the decline has provided a great entry point if you’re considering a purchase.  You can read more of our updates on Paylocity here.

The following table shows the performance of the holdings within the Income Equity strategy. 

This strategy has also outperformed, and we continue to be comfortable with the stocks in this strategy going forward.  You can read our complete thesis for all of the holdings in all of our strategies here.

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