2 for 1
Volume 20 Issue 8
®
Neil Macneale’s
Stock Split
Newsletter
2-for-1.com A ugust
JULY SPLITS – OUR BUY
PORTFOLIO ITEMS
Exponent Inc.
19 Years and Counting
here were several interesting challenges
____regarding the selection of this month’s
addition to the 2 for 1 Index and model portfolio.
First, there were only two legitimate split announcements in July. Zillow’s (Z) July 21 split
announcement doesn’t count because it creates a
separate class of non-voting stock with a different
trading symbol. Under Armour (UA) did the
same thing in June and I included it in my
evaluation. I have now decided to make this type
of spilt automatically ineligible and will not
include them on the monthly list for analysis.
Second, one of the July splits is Reynolds
American (RAI), a tobacco company. I would like
to make all tobacco companies also automatically
ineligible for consideration, but I realize this is
more a personal prejudice than a business consideration, so I left it on the list for evaluation.
Including a group of likely companies
from previous months, along with July’s RAI and
Medivation (MDVN), brings up Exponent Inc.
(EXPO), a #3 ranked stock from the April list.
EXPO is a scientific and engineering consulting
company headquartered just about a mile from
my house here in Menlo Park, CA. Trading a bit
lower than its price in May, EXPO’s numbers
improved enough in these few months to push it
to the top of the list. EXPO’s valuation metrics
are average to a little high; but a nice 1.4% dividend, very steady ±14% earnings growth per year,
below-market volatility, and $0 debt all add up to
make this a fine addition to the 2 for 1 Index.
Symbol
EXPO
SJI
RAI
MPC
ETE
ROST
MDVN
HBI
KR
Company
Exponent, Inc
South Jersey Ind.
Reynolds American
Marathon Petroleum
Energy Trans. Equity
Ross Stores
Medivation Inc
HanesBrands Inc
Kroger Co.
Split Delivery
Rank
05/28/15
05/07/15
08/31/15
06/10/15
07/24/15
06/11/15
09/15/15
03/03/15
07/13/15
1
2
3
3
3
4
4
4
4
14, 2015
T
his issue marks the beginning of the 20th full year
____of publication of 2 for 1. The first issue is still
available on the 2-for-1.com website for anyone
interested. These past nineteen years have seen the
market battered by the dot-com bubble and crash, the
trauma of 9/11, the housing bubble, and the Great
Recession, all interspersed with two of the longest
stock-price run-ups on record. Through it all, 2 for 1
has stuck to its methodology and has been handsomely
rewarded with an 11.28% annualized return. Very, very
few other newsletters or mutual funds can demonstrate
a similar proven track record over such a long period.
In addition to exploiting the Stock Split Advantage, 2 for 1 also takes to heart much of the advice
every investor has heard ad nauseam; diversify, dollarcost-average, have a buy AND a sell strategy, be
consistent, invest in real companies instead of gambling
on pipe dreams or hot tips, etc., etc. All of this is folded
into the easily executed strategy that has been 2 for 1
for all these years. With the licensing of the 2 for 1
Index® to USCF Advisers, the strategy is now widely
available through their ETF, the Stock Split Index
Fund (TOFR). So I take this opportunity to thank all
the folks who have supported 2 for 1 over the years,
and also to those journalists who have reported on it.
THIS MONTH’S SELL
Cytec Industries
O
n 7/29, Cytec (CYT) was “in play” because of a
_____buyout announcement and its stock price
immediately jumped about 26%. The buyer, Solvay, is a
Belgian company not traded on the US exchanges.
Rather than waiting to
7/15
determine if the buyout
10/14
would be in cash or for
Solvay stock, our position
in Cytec was sold immediately. Owned for less than a
year, CYT’s overall return was 67.8%. The Vanguard
500 Index Fund had a 10.8% gain over the same
period. Sale of Colgate-Palmolive (CL), the stock at the
top of the ladder, will be delayed until September.
2
1
2 for 1
August 2015
2 for 1 MODEL PORTFOLIO – JULY STATEMENT
# SH
BOUGHT
QUOTE
AT
BUY
QUOTE
ON
07/31/15
BASIS
START
MONTH
$789.35
END
MONTH
$18,701.55
160
200
310
440
340
201
250
150
170
184
220
232
300
350
300
119
108
230
220
216
280
200
660
380
232
260
108
350
180
03/18/13
11/15/10
04/22/13
05/20/13
06/17/13
07/15/13
08/19/13
09/16/13
10/21/13
11/18/13
12/16/13
01/21/14
02/18/14
03/17/14
04/21/14
05/19/14
06/16/14
07/21/14
08/18/14
09/15/14
11/17/14
12/15/14
01/20/15
02/17/15
03/16/15
04/20/15
05/18/15
06/15/15
07/20/15
55.822
19.147
35.342
21.173
27.054
47.883
38.030
65.317
57.429
56.302
46.470
45.193
34.607
30.554
34.667
86.355
100.426
47.719
37.668
52.086
41.936
55.204
17.395
31.920
52.018
47.963
115.977
35.340
67.136
68.020
71.820
34.170
39.820
38.550
45.550
59.870
92.520
79.030
62.430
55.230
40.410
33.780
32.370
42.260
121.300
97.590
45.510
71.540
56.410
54.160
67.980
16.080
28.900
54.360
57.930
108.380
38.630
59.200
8,931.59
3,829.39
10,955.98
9,315.99
9,198.49
9,624.49
9,507.49
9,797.49
9,762.89
10,359.53
10,223.49
10,484.79
10,381.99
10,693.74
10,399.99
10,276.29
10,846.00
10,975.33
8,287.03
11,250.63
11,741.96
11,040.87
11,480.79
12,129.73
12,068.19
12,470.36
12,525.56
12,368.84
12,084.39
10,465.60
14,396.00
10,676.40
16,086.40
12,712.60
9,855.03
14,520.00
13,491.00
13,509.90
10,626.00
11,305.80
9,862.32
9,654.00
12,152.00
12,966.00
14,925.58
10,299.96
9,321.90
13,301.20
12,521.52
14,616.00
13,172.00
10,837.20
10,469.00
13,012.88
13,939.90
12,389.76
12,701.50
12,084.39
10,883.20
14,364.00
10,592.70
17,520.80
13,107.00
9,155.55
14,967.50
13,878.00
13,435.10
11,487.12
12,150.60
9,375.12
10,134.00
11,329.50
12,678.00
14,434.70
10,539.72
10,467.30
15,738.80
12,184.56
15,164.80
13,596.00
10,612.80
10,982.00
12,611.52
15,061.80
11,705.04
13,520.50
10,656.00
2.86%
3.77%
2.78%
4.60%
3.44%
2.40%
3.93%
3.64%
3.53%
3.01%
3.19%
2.46%
2.66%
2.97%
3.33%
3.79%
2.77%
2.75%
4.13%
3.20%
3.98%
3.57%
2.79%
2.88%
3.31%
3.95%
3.07%
3.55%
2.80%
$381,035.28
100.00%
CASH
CL
AOS
TU
HOMB
AWR
BEN
WST
TSCO
DVA
CNI
RLI
TD
ITC
MLI
AWH
AAPL
UNP
OTEX
COLM
APH
CALM
HAIN
GNTX
NJR
MGA
SBUX
PPG
NTT
CF
COLGATE-PALMOLIVE
A. O. SMITH
TELUS
HOME BANCSHARES
AMERICAN STATES WATER
FRANKLIN RESOURCES
WEST PHARMACEUTICAL SERVICES
TRACTOR SUPPLY
DAVITA HEALTHCARE PARTNERS
CANADIAN NATIONAL RAILWAY
RLI CORP.
TORONTO-DOMINION BANK
ITC HOLDINGS
MUELLER INDUSTRIES
ALLIED WORLD ASSURANCE
APPLE CORP
UNION PACIFIC
OPENTEXT INC
COLUMBIA SPORTSWEAR
AMPHENOL
CAL-MAINE FOODS
HAIN CELESTIAL GROUP
GENTEX CORP
NEW JERSEY RESOURCES
MAGNA INTERNATIONAL INC
STARBUCKS CORP.
PPG INDUSTRIES
NIPPON T & T
CF INDUSTRIES HOLDINGS
TOTAL CASH AND EQUITIES
$303,013.29
ACCOUNT VALUE SUMMARY - 7/31/15
Description
Last Month’s Closing Equity
Change in Stock Value
Interest & Dividends
This Month’s Closing Equity
Amount
$370,379.24
$10,063.39
$592.66
$381,035.28
350k
THE FINE PRINT
PORTFOLIO PERFORMANCE
2 FOR 1
300k
250k
200k
150k
100k
50k
(all costs and dividends included for both)
The above list represents all of the securities recommended, bought,
and which are now present in the 2 for 1 portfolio, an IRA account with
E*Trade in the editor’s name. The 30 stocks on this list constitute the
entire 2 for 1 portfolio. The graph of the performance of the 2 for 1
portfolio to the right was adjusted to equal the Vanguard 500 Index
Fund at the end of July, 1996, adjusted for and including dividends. The
Vanguard 500 Index Fund tracks the S&P 500, an index tracking the
500 largest U.S. companies. 2 for 1 tracks the 2 for 1 Index®, based on
a portfolio of 30 companies, large and small. The 2 for 1 portfolio was
started in July, 1996 with $50,000. The $303,013 basis above reflects
$253,013 in capital gains, dividends, and interest accrued since the
portfolio’s inception. It shall not be assumed that recommendations
made in this issue of 2 for 1, or in any future issues, will be profitable or
will equal the performance of the securities on this list.
% OF
PORT
4.91%
400k
A NNUALIZED RETURN 7/31/96 – 7/31/15
2 for 1: + 1 1.2 8%
Vanguard 500 Fund: +8.36%
X
Vanguard 500 Index Fund
97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15
2 for 1® is published and distributed by Neil Macneale, Inc.,
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dba 2 for 1®, is not a broker and does not offer individual
investment advice. 2 for 1 is published each month on the
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