Our first idea is a tech company whose shares just crossed over their 50-day moving average—a bullish indicator. Our second recommendation is profit-taking on a previous pick.
Buy: DST Systems, Inc. (DST)
From 2 for 1 Stock Split Newsletter
DST Systems, Inc. (DST) has nice valuation numbers, well below average, including PE and price-to-book ratios of 10.5 and 3.2 respectively—all the more notable given the earnings growth numbers are well above average.
The balance sheet is strong, profit margins are excellent, and returns on assets and equity are very good and getting better. DST pays a small dividend—not great but it has been growing at over 12% a year for a while now.
DST is more volatile than the market, with a Beta of 1.33, but all the other good numbers outweigh this single significant negative metric.
DST delivered its split shares last week, resulting in a little spike in trading activity. That seems to have settled down now and now is a good time as any to add DST to our portfolio.
Full disclosure: Neil Macneale Inc. is the index provider to the Stock Split Index Fund (TOFR). This ETF is distributed by ALPS, a wholly-owned subsidiary of DST Systems.
Neil Macneale, 2 for 1 Stock Split Newsletter, www.2-for-1.com, 408-210-6881, June 2017