The following are today’s upgrades for Validea’s Contrarian Investor model based on the published strategy of David Dreman . This contrarian strategy finds the most unpopular mid- and large-cap stocks in the market and looks for improving fundamentals.
PPL CORP ( PPL ) is a large-cap value stock in the Electric Utilities industry. The rating according to our strategy based on David Dreman changed from 71% to 83% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: PPL Corporation ( PPL ) is a utility holding company. Through its subsidiaries, PPL delivers electricity to customers in the United Kingdom, Pennsylvania, Kentucky, Virginia and Tennessee; delivers natural gas to customers in Kentucky, and generates electricity from power plants in Kentucky. PPL operates through U.K. Regulated Segment, Kentucky Regulated Segment and Pennsylvania Regulated Segment. The U.K. Regulated Segment consists of PPL Global, which includes PPL WPD Limited’s (WPD) regulated electricity distribution operations, the results of hedging the translation of WPD’s earnings from British pound sterling into United States dollars, and certain costs, such as the United States income taxes, administrative costs and allocated financing costs. Kentucky Regulated segment consists of the operations of Louisville Gas and Electric Company (LG&E) and KU Energy LLC (LKE). The Pennsylvania Regulated segment consists of PPL Electric Utilities Corporation (PPL Electric).
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
|EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE:||PASS|
|PRICE/CASH FLOW (P/CF) RATIO:||FAIL|
|PRICE/BOOK (P/B) VALUE:||FAIL|
|PRICE/DIVIDEND (P/D) RATIO:||PASS|
|RETURN ON EQUITY:||FAIL|
|PRE-TAX PROFIT MARGINS:||PASS|
|LOOK AT THE TOTAL DEBT/EQUITY:||FAIL|
For a full detailed analysis using NASDAQ’s Guru Analysis tool, click here
Since its inception, Validea’s strategy based on David Dreman has returned 125.27% vs. 178.54% for the S&P 500. For more details on this strategy, click here
About David Dreman : Dreman’s Kemper-Dreman High Return Fund was one of the best-performing mutual funds ever, ranking as the best of 255 funds in its peer groups from 1988 to 1998, according to Lipper Analytical Services. At the time Dreman published Contrarian Investment Strategies: The Next Generation, the fund had been ranked number one in more time periods than any of the 3,175 funds in Lipper’s database. In addition to managing money, Dreman is also a longtime Forbes magazine columnist.
About Validea : Validea is an investment research service that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.