Summary
- This article provides a follow-up study reviewing the 6-month performance of the top “zombie” firm portfolio selections based on Federal Reserve metrics.
- Three different model returns from March are reviewed, with sample stock portfolios down -23.4%, -29.9%, and -32.2% on average over the past 6 months.
- The study identifies high-risk companies that are considered economically unviable and rely on borrowing to stay alive, from over 1,300 at-risk stocks identified.
- New top zombie selections are provided using four different high-risk parameters to continue the evaluation period as interest rates are reaching 22-year highs.
- Looking for a portfolio of ideas like this one? Members of Value & Momentum Breakouts get exclusive access to our subscriber-only portfolios. Learn More »
Introduction
This six-month follow-up study reviews the performance of the top “zombie” firm portfolio selections released back in March based on the Federal Reserve metrics from their commissioned research. In addition to a review of the worst-scoring firms from March, I am releasing new sample zombie selections from each of the models for another test of the Federal Reserve’s parameters.
JD Henning is a Finance PhD, MBA, investment adviser, fraud examiner and certified anti-money laundering specialist with more than 30 years trading and investing stocks and other securities. JD runs Value & Momentum Breakouts where he identifies identify breakout signals and breakdown warnings using technical and fundamental analysis. Signals from his proprietary Momentum Gauges® not only alert subscribers of market changes, but the strength of markets for short term breakouts or breakdown warnings across 11 different sectors. Top stock and ETF selections use technical and fundamental systems in proven financial studies. Value & Momentum Breakouts is the place to build your own optimal portfolio mix with a community of like-minded investors and traders. Features include a Premium Portfolio, bull/bear ETF strategy, morning updates and an active chat room. Learn more.
Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha’s Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
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