Wayman Value Investing April 2024 Portfolio

Take a look at our current holdings

April 2024 Outlook

In March, the S&P 500 soared to new all-time highs, concluding its best first quarter since 2019. Concerns over a potential U.S. economic downturn have diminished, replaced by a focus on the Federal Reserve’s anticipated shift from monetary tightening to easing.

The first quarter also witnessed significant gains in artificial intelligence-related stocks, alongside dovish comments from Federal Reserve officials, propelling both the Dow Jones Industrial Average and the Nasdaq to impressive gains. Investor sentiment remains buoyant, with optimism running high for the market’s ability to sustain its momentum.

The market’s upward trajectory in the first quarter was widespread, with technology, consumer cyclical, and consumer defensive sectors leading the charge, each delivering total returns of 8% or more.

Looking ahead, the Federal Reserve’s stance on inflation and interest rates will play a pivotal role in shaping market dynamics. While progress has been made in curbing inflation, concerns linger over lingering price pressures, particularly in sectors like shelter. The Fed hinted at a possible shift in policy restraint later in the year, indicating a potential pivot towards accommodative monetary policy.

As investors brace for first-quarter earnings reports, expectations remain cautiously optimistic. Despite headwinds posed by inflation and rising interest rates, S&P 500 companies reported modest earnings growth in the fourth quarter of the previous year. Analysts are forecasting similar growth for the first quarter of 2024, albeit with some variability across sectors.

With the market in a strong uptrend heading into earnings season, investors are advised to approach pullbacks as potential buying opportunities. The performance of key sectors, such as banking, will provide critical insights into the health of the economy and corporate earnings. As the S&P 500 charts its course for the remainder of the year, historical data suggests that a positive start bodes well for continued gains, reinforcing investor optimism despite potential challenges ahead.

User Guide - Tracking the Spreads

What are spreads, and why should you care? I believe that tracking spreads is essential for making informed investment decisions. Each month I categorize stocks into tiers based on the spread between their calculated value and market value.

Here’s how it works:

STASH: This tier includes stocks with the largest spreads. These are the hidden gems that offer significant potential upside. Based on my valuation, now is the perfect time to capitalize on their undervalued status.

GATHER: Stocks in this tier have a substantial spread, but not as significant as those in the Stash tier. They still offer attractive opportunities for investment, and I recommend considering them for your portfolio.

STORE: The Store tier consists of stocks with modest or tightening spreads. While they may not have as much potential for immediate growth, they still hold value and can contribute to a balanced portfolio. Wayman holds these stocks, but I am not actively buying additional shares this month.

CACHE: In this tier, stocks have narrow or no spreads, indicating that their market value aligns closely with Wayman’s calculated value. It may be time to consider exiting positions in these stocks and reallocating your resources.

Categorizing stocks based on spreads helps you identify stocks with the greatest potential for growth. I believe in capturing maximum upside while minimizing potential losses, and Wayman’s tiered system allows you to prioritize your investment decisions.

Model Allocation

For the purpose of third-party portfolio tracking and validation we use the following model portfolio allocation:

• 65% invested in Stash tier stocks

• 30% invested in Gather tier stocks

• 5% invested in Store tier stocks

The Wayman portfolio is tracked and audited by Hulbert Ratings, which has been rigorously tracking the real-world performance of investment advisory newsletters for over 40 years. You can follow our performance here.

Wayman Value Investing Portfolio - April 2024

STASH

• CNC - Centene

• CRC - California Resources Corporation

• EXPE - Expedia Group

• KBH - KB Home

• MCK - McKesson

• OBDC - Blue Owl Capital Corporation

• PATK - Patrick Industries

• SYF - Synchrony Financial

• THO - Thor Industries

• TOL - Toll Brothers

• TPH - Tri Pointe Homes

• TRV - The Travelers Companies

• YELP - Yelp

GATHER

• ALL - The Allstate Corporation

• APAM - Artisan Partners Asset Management

• ATKR - Atkore

• AXP - American Express Company

• CI - The Cigna Group

• CORT - Corcept Therapeutics

• EVR - Evercore

• HIG - The Hartford Financial Services Group

• JPM - JPMorgan Chase & Co.

• KNSL - Kinsale Capital Group

• PGR - The Progressive Corporation

• SAH - Sonic Automotive

• TMHC - Taylor Morrison Home Corporation

• VCTR - Victory Capital Holdings

• WGO - Winnebago Industries

STORE

• ABBV - AbbVie

• ALSN - Allison Transmission Holdings

• ARCB - ArcBest

• ASO - Academy Sports and Outdoors

• BLDR - Builders FirstSource

• CACI - CACI International

• CAH - Cardinal Health

• CE - Celanese

• CPAY - Corpay Inc

• CTSH - Cognizant Technology Solutions

• CVS - CVS Health

• FOX - Fox Corporation

• GEF - Greif

• GL - Globe Life

• LEN - Lennar Corporation

• MTZ - MasTec

• OC - Owens Corning

• PRGS - Progress Software Corporation

• SAIC - Science Application International Corporation

• SF - Stifel Financial

• SFM - Sprouts Farmers Market

• TROW - T. Rowe Price Group

• URBN - Urban Outfitters

CACHE

• BERY - Berry Global Group (Sell Recommended Mar. 27, 2024)

• GILD - Gilead Sciences (Sell Recommended Mar. 27, 2024)

• GS - The Goldman Sachs Group (Sell Recommended Mar. 27, 2024)

• HLI - Houlihan Lokey (Sell Recommended Mar. 27, 2024)

• LAD - Lithia Motors (Sell Recommended Mar. 27, 2024)

• TSN - Tyson Foods (Sell Recommended Mar. 27, 2024)

• UHS - Universal Health Services (Sell Recommended Mar. 27, 2024)