Undervalued Stocks with Respect to Growth and Yield (PEG+Y Ratio)

As the Stock Market including the U.S. S&P 500 Index goes down, experienced people say you should start creating a wish list of companies to buy at lower levels.

One measure of valuation is the PEG+Y Ratio which is the Forward Price Earnings Ratio divided by the Five Year Estimated Growth Rate Plus Yield:

PEG+Y = (Forward Price Earnings Ratio) / (5 Year Estimated Growth Rate + Yield)

PEGY (simpler form is the PEG Ratio) of less than 1 is a great value. A PEGY ratio of greater than 2 (or some other value like 1.5) can be considered overvalued.

Here are some PEG+Y Ratios of some popular companies:

#	Symbol	Company	PEG+Y	Current Price	Forward P/E	5 Year Growth Rate	Forward Yield
1	CEDC	Central European Distribution	0.15	6.08	7.07	46.62	0.00
2	BTU	Peabody Energy	0.16	31.61	5.56	33.05	1.00
3	SI	Siemens	0.22	86.96	8.37	35.50	3.00
4	FCX	Freeport-McMoran	0.27	29.87	4.99	15.06	3.30
5	AEA	Advance America	0.37	7.12	6.72	15.00	3.40
6	BAC	Bank of America	0.38	5.53	4.61	11.48	0.70
7	LVS	Las Vegas Sands	0.38	36.71	14.86	30.08	0.00
8	VE	Veolia	0.41	13.78	9.44	13.15	10.10
9	NXG	Northgate Minerals	0.42	3.26	15.52	36.80	0.00
10	JPM	JP Morgan	0.44	28.65	5.4	8.96	3.30
11	SHFL	Shuffle Master	0.45	7.74	11.22	25.00	0.00
12	GLW	Corning Glassware	0.46	11.88	6	11.50	1.60
13	HRS	Harris Corp	0.47	33.23	6.09	9.63	3.30
14	CNQ	Canadian Natural Resources	0.49	27.59	7.79	14.70	1.20
15	WFC	Wells Fargo	0.50	23.18	6.94	12.00	2.00
16	ABB	ABB Ltd	0.50	16.42	8.6	13.40	3.90
17	GE	General Electric	0.50	14.69	9.3	14.74	3.90
18	BIDU	Baidu	0.50	105.16	23.9	47.65	0.00
19	AAPL	Apple	0.51	374.6	11.47	22.69	0.00
20	NIHD	NII Holdings Inc.	0.51	25.06	9.49	18.66	0.00
21	NTES	NetEase	0.52	36.35	8.95	17.30	0.00
22	CAT	Caterpillar	0.53	70.55	7.94	12.44	2.50
23	PCLN	Priceline	0.54	445.75	15.23	28.31	0.00
24	GILD	Gilead	0.54	37.81	8.4	15.43	0.00
25	RTN	Raytheon	0.55	39.5	7.22	9.00	4.20
26	INTC	Intel	0.56	20.62	8.35	11.03	3.90
27	SLB	Schlumberger	0.56	57.72	10.67	17.32	1.70
28	GS	Goldman Sachs	0.57	90.08	5.97	9.04	1.50
29	TDG	Transdigm Group	0.57	77.38	14.2	24.97	0.00
30	NFLX	Netflix	0.59	113.25	17.37	29.32	0.00
31	CELG	Celgene	0.59	60.7	14.35	24.16	0.00
32	GEOY	Geo Eye	0.61	27.1	2 10.72	17.50	0.00
33	GOOG	Google	0.61	495.52	11.8	19.21	0.00
34	HCBK	Hudson City Bancorp	0.64	5.31	6.9	5.00	5.70
35	PM	Philip Morris	0.65	61.76	11.88	13.26	4.90
36	SWY	Safeway	0.66	16.32	8.77	9.78	3.50
37	DECK	Deckers	0.67	88.11	15.09	22.50	0.00
38	LOW	Lowe's	0.68	18.98	10.66	12.73	2.90
39	MDRX	AllScripts	0.69	16.99	15.88	23.11	0.00
40	HD	Home Depot	0.71	31.59	11.79	13.51	3.00
41	TRMB	Trimble Navigation	0.73	32.4	2 13.4	18.25	0.00
42	MA	Mastercard	0.74	310.88	14.92	19.84	0.20
43	CSCO	Cisco	0.76	15.19	8.08	9.20	1.50
44	RIG	Transocean	0.76	45.91	7.77	3.65	6.60
45	DEO	Diageo	0.79	75.15	11.82	10.70	4.30
46	TGT	Target	0.82	47.8	11.01	10.96	2.40
47	WMT	Walmart	0.83	51.96	10.63	10.00	2.80
48	AMX	America Movil	0.84	21.5	9.51	9.95	1.40
49	ATVI	Activision	0.85	11.95	12.85	13.68	1.40
50	MO	Altria Group	0.86	26.56	12.13	8.0	0 6.10
51	INFY	Infosys	0.87	50.04	15.44	16.14	1.70
52	CME	Chicago Mercantile Exchange	0.87	248.5	12.76	12.44	2.30
53	IBM	IBM	0.87	173.29	11.74	11.83	1.70
54	CVS	CVS Caremark	0.87	32.97	10.34	10.35	1.50
55	GME	Gamestop	0.88	22.97	7.32	8.34	0.00
56	IGT	International Game Technology	0.89	13.73	12.15	11.99	1.70
57	ECOL	US Ecology	0.90	15.05	14.07	11.00	4.70
58	XOM	Exxon Mobil	0.90	71.15	8.14	6.47	2.60
59	WM	Waste Management	0.90	31.36	12.85	10.00	4.20
60	JACK	Jack in the Box	0.92	19.26	10.82	11.80	0.00
61	WEN	Wendy's	0.92	4.46	19.3	9 19.28	1.70
62	YUM	YUM Brands	1.02	48.45	15.0	9 12.56	2.30
63	PEP	Pepsi	1.06	60.29	12.51	8.55	3.30
64	ERTS	Electronic Arts	1.06	19.76	16.61	15.73	0.00
65	MON	Monsanto	1.08	60.11	17.58	14.30	2.00
66	VCLK	Value Click	1.08	14.92	13.44	12.43	0.00
67	UL	Unilever	1.10	30.56	12.18	7.00	4.10
68	PG	Procter and Gamble	1.12	62.84	13.63	8.90	3.30
69	T	AT&T	1.14	28.16	11.09	3.77	6.00
70	MCD	McDonalds	1.14	86.02	15.06	10.01	3.20
71	QSII	Quality Systems	1.15	92.11	26.85	21.95	1.40
72	SNDA	Shanda Interactive	1.17	28.86	15.86	13.53	0.00
73	K	Kellogg	1.18	52.88	13.95	8.65	3.20
74	GIS	General Mills	1.24	37.96	13.41	7.60	3.20
75	SWK	Stanley Black and Decker	1.26	48.25	7.91	3.00	3.30
76	YHOO	Yahoo	1.27	13.53	16.3	12.84	0.00
77	HMSY	HMS Holdings	1.27	22.95	31.01	24.33	0.00
78	JNJ	Johnson and Johnson	1.28	62.08	11.74	5.58	3.60
79	HAIN	Hain Celestial	1.28	28.31	16.27	12.70	0.00
80	PCP	Precision Castparts	1.28	148.33	14.29	11.05	0.10
81	HRL	Hormel Foods	1.31	26.53	14.99	9.50	1.90
82	ISRG	Intuitive Surgical	1.39	348.76	25.81	18.62	0.00
83	KO	Coca Cola	1.42	65.42	15.29	8.00	2.80
84	HANS	Hansen Natural	1.43	79.76	22.4	15.70	0.00
85	WFM	Whole Foods	1.44	62.44	27.75	18.70	0.60
86	CERN	Cerner	1.48	65.56	29.53	19.89	0.00
87	SGMS	Scientific Games	1.50	6.63	14.41	9.63	0.00
88	COST	Costco	1.52	81.63	21.26	12.77	1.20
89	GRMN	Garmin	1.56	30.6	14.17	4.10	5.00
90	COP	Conoco Philips	1.61	60.99	7.07	0.20	4.20
91	CMG	Chipotle Mexican Grill	1.65	292.7	33.88	20.50	0.00
92	CLH	Clean Harbors	1.69	47.83	20.18	11.93	0.00
93	AMT	American Towers	1.98	52.86	38.58	19.46	0.00
94	AMZN	Amazon	2.39	211.98	66.24	27.67	0.00
95	RGR	Sturm Ruger	5.80	24.63	12.76	0.00	2.20

Are Large Cap Consumer Staple and Health Care Stocks Really Recession Proof?

A recent poster on this blog commented on the "Anti-Recession Stocks that can survive a US Slowdown" blog post. The poster said:

Well you were most certainly wrong. Too bad folks like you can't get out of the mindset that just because a company is big and been around a while doesn't mean it's stock will do well.

Let's evaluate the stocks chosen in the previous blog entry to see whether or not the stock selection was wrong. The assumption is that large consumer staple and health care stocks tend to survive slowdowns and recessions.

Assumption: Sector Rotation

But first, let us look at an assumption. Let us assume that a portfolio is 100% in stocks, and whether the market goes down or up, the portfolio manager (you) has to remain 100% invested. In this case, we have to either hold the stocks we currently own, or we have to rotate into other stocks.

Many professional money managers have to do the same. They are supposed to maintain a percentage of their fund in equities, and when the market goes down, they could rotate stocks from one sector to another.

The Slowdown/Recession playbook tells us to rotate into large cap consumer staples and health care stocks as a safer investment to ride out the slowdown or recession.

With this assumption in mind, six stocks were selected in the previous blog post that were "anti-recession." Most are large cap, consumer staple or healthcare stocks, except one, Sun Healthcare (SUNH) which is a small cap health care stock.

Performance of the Stocks

From January 7, 2008 (around the time the previous blog entry was written) to today, July 15, 2008, here is the performance of the stocks:

1. SPY (S&P 500 ETF): -13.47%
   
2. PG (Procter and Gamble): -10.27%
   
3. UL (Unilever): -25.97%
   
4. MO (Altria): -11%
   
5. GILD (Gilead): +15.28%
   
6. SUNH (Sun Healthcare): -17.71%
   
7. PEP (Pepsi): -14.2%
   

All of the results above do not include dividends. If you include dividends, the performance of the stocks above would be better.

In addition, instead of choosing SUNH, we had chosen it's competitor, Kindred Healthcare (KND), the return during this period of KND would have been +20.16% instead of SUNH's -17.71%

The Results

Period: January 7, 2008 to July 15, 2008:


Average of the Six Anti-Recession Stocks (no dividends): -10.65%
S&P 500 Performance: -13.47%


The Six "anti-recession" stocks outperformed the market by almost 3%. In this difficult bear market, outperforming the market is a good thing.

Check Performance Now

Biotech has been breaking out

Build Your Own High Gain Stock Portfolio, One Sector At a Time

There are many ways to construct your own stock portfolio.

One way to create a diversified portfolio is to choose stocks from different sectors that follow these criteria:

1. The stock is in a good sector.
   
2. The stock is a good stock in a good sector.
   
3. The stock has Reasonable Valuation:
   a. PEG < 2.0 (Price-Earnings to Growth Ratio).
   b. Forward PE < 40
   
4. The stock shows Strength:
   a. Stock is within reach of a 52 week high.
   b. Stock is above the moving averages (200 day, and even 50 day moving average).
   

Here are a few suggestions that mostly fit the criteria above. One could create a portfolio by choosing a stock or a few stocks from each sector below.

A. Tech: Internet and Information

We are in the middle of a society changing Information Revolution, and the Internet plays a central role.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
GOOG	Google	0.91	31	33.88%

B. Tech: Mobile Convergence and Mobile Devices

One of the major trends is the trend towards Mobile Convergence. Rather than have separate devices, such as a cell phone, a camera, and a music player, all these features are being integrated into a single mobile device. The Apple Iphone is a web browser, a music player, and a cell phone. Cell phones now come with cameras and music playing capabilities.

In addition, globalization is helping this sector out as international and emerging markets are adopting these mobile technologies in great numbers. One Indian person has even said that in India, even beggars have cell phones.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
AAPL	Apple	1.66	37.52	22.63%
RIMM	Research In Motion	1.04	35.06	33.61%
NOK	Nokia	1.40	17.06	12.22%

Aside from the Apple iphone, Apple (AAPL) has many other products as well such as the Apple iPod music player, and the Apple iMac computer.

Nokia (NOK), is also a play on Global Positioning as it is acquiring Digital Map Maker Navteq (NVT).

C. Tech: Networking/Digital TV/Telecom Equipment

Another trend is in the Network.

1. There is a trend having greater Bandwidth for advanced services (for example, High Definition Video on Demand).
   
2. There's the conversion of analog TV to digital TV. On February 2009, companies are supposed to stop broadcasting analog television, and are supposed to broadcast digitally.
   
3. There is the Battle for the Digital Living Room. From IP Television (IPTV), to Digital TV, to High Definition TV sets, to Digital Video Recorder Technology (DVRs), to digital set-top boxes, to streaming content from computers to the big screen, the battle for the Digital Living Room is just beginning.
   
4. The trend also includes wireless telecommunication systems that help bring advanced services (video on a cell phone) to mobile devices.
   

Symbol	Stock Name	PEG	Forward PE	5 yr growth
CSCO	Cisco	1.25	17.64	14.10%
GLW	Corning	0.95	15.80	16.57%
NNDS	NDS Group	0.69	16.39	23.75%
HRS	Harris	0.58	15.68	27.00%

Cisco (CSCO) is the big company in Networking. They also have Set-Top Box exposure (access to the Digital Living Room) with their acquisition of Set Top Box maker Scientific Atlanta.

Corning (GLW) makes glass and equipment for higher bandwidth optical networking. They are also a play on the Digital Living Room as their products are needed by those who make flat panel displays and High Definition TVs.

NDS Group (NNDS) is the United Kingdom's version of the overhyped Chinese company China Digital TV (STV). The company engages in the supply of open end-to-end digital technology and services to digital pay-television platform operators and content providers worldwide. They even supply middleware and Digital Video Recorder Technologies, and Set-Top Boxes, and they support high definition TV.

Harris (HRS) is a company which operates in four main segments from Government Communication Systems, RF Communications, Broadcast Communications and wireless networking through Harris Stratex (HPTX). Their Broadcast Communications Group is involved Digital TV. They also benefit from a good win rate on government contracts.

D. Tech: GPS and Global Positioning

A major growth area in tech is in Global Positioning Technlogies. This technology is more than just turn by turn directions on a navigation device. In the future, as part of Mobile Convergence, GPS will be integrated into almost any device which can move, such as a cell phone.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
GRMN	Garmin	1.44	28.06	19.53%
TRMB	Trimble	1.86	28.94	15.60%
SIRF	Sirf Technologies	0.77	20.44	26.62%

Garmin (GRMN) mainly makes Global Positioning Devices. They are big in the car navigation and aeroplane navigation market. Recent concerns include the intended acquisition of their Digital Map Supplier Navteq (NVT) by Nokia (NOK).

Trimble Navigation (TRMB) makes GPS products. They are also a unique play on the good Agriculture market, as they even have GPS equipment for farm equipment and tractors.

Sirf Technologies (SIRF) makes GPS semiconductors. Their chips are finding their way into devices such as cell phones.

E. Tech/Consumer Discretionary: Computer, Video and Online Gaming

The strong Gaming cycle is continuing as three major console makers (Nintendo, Microsoft and Sony) have released major consoles.

There are also up and coming new trends such as online gaming, especially in East Asia (China).

Symbol	Stock Name	PEG	Forward PE	5 yr growth
GME	Gamestop	1.36	28.92	21.22%
SNDA	Shanda Interactive	0.64	21.26	33.26%

Gamestop (GME) is the premiere gaming retailer. Why choose the winner of the console or software maker war when you can buy the retailer who sells all these products.

Shanda Interactive (SNDA) together with The9 Limited (NCTY) are dominant Chinese Online Gaming companies poised for great growth.


F. Energy: Oil and Oil Services.

Energy and Oil remain strong sectors. There's great demand as countries all over the world, especially the emerging market countries, need oil. Supply is limited as well, and harder to come by.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
COP	Conoco Philips	0.93	9.19	9.92%
NOV	National Oilwell Varco	0.60	17.89	29.67%

Conoco Philips (COP) is an integrated oil company, while National Oilwell Varco (NOV) is an Oil Services and Equipment Company, and operates three segments: Rig Technology, Petroleum Services and Distribution Services.

G. Energy: Coal

Energy sources such as oil are in great demand. Coal, a very inexpensive fossil fuel, benefits from the great demand in energy.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
BTU	Peabody Energy	0.93	9.19	9.92%

H. Materials

Freeport McMoran (FCX) is a gold and copper company, and both are needed by rapidly growing emerging market countries such as China.

Precision Castparts (PCP) manufactures metal components used in the aerospace, power generation, general industrial, and automotive markets. There's a bull market in aerospace and infrastructure, and Precision Castparts benefits.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
FCX	Freeport McMoran	0.98	10.82	11.00%
PCP	Precision Castparts	0.85	18.13	21.23%

I. Agriculture

There's a Bull market in agriculture, thanks to an influential US Farm Bill in 2002.

Monsanto (MON) makes seeds, including very specialized and drought resistant seeds. Deere (DE) makes agricultural equipment. Trimble Navigation (TRMB) is also an unusual play on agriculture as they provide GPS products to many places, including tractors and the agriculture industry.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
MON	Monsanto	0.95	29.53	30.93%
DE	Deere	1.75	16.21	9.25%

J. Aerospace and Defense

There's a Bull market in Aerospace and Defense thanks to the aeroplane replacement cycle. Many of the older planes have to be replaced.

Boeing (BA) makes airplanes and is a better play than competitor Airbus. Transdigm Group (TDG) is a $2B company that supplies parts to the Aerospace industry. Lockheed Martin (LMT) is a defense contractor that makes many defense products, including military aircraft.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
BA	Boeing	1.08	15.86	14.70%
TDG	Transdigm Group	0.64	18.24	28.50%
LMT	Lockheed Martin	1.33	15.31	11.52%

K. Infrastructure

With great global growth comes a great need for Infrastructure.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
ABB	ABB Limited	0.83	20.63	25.00%
MDR	McDermott	1.38	22.01	16.00%

L. Telecom: Emerging Market Wireless Telecom

Emerging Markets are using wireless products in large numbers. Many emerging countries have low wireless penetration so there is even more room to grow.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
AMX	America Movil	0.49	15.89	32.65%
VIP	Vimpel Communications	0.75	17.49	23.37%
CHL	China Mobile	0.98	24.66	25.14%

M. Financials

Goldman Sachs (GS) is the premier brokerage company, the gold standard.

Hudson City Bank (HCBK) is a fast growing regional bank that has very little exposure to the subprime problems, and some have speculated that along with other Northeastern banks, could be taken over by Canadian banks and other companies.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
GS	Goldman Sachs	0.76	9.91	13.12%
HCBK	Hudson City Bank	1.09	18.73	17.15%

N. Asset Management Companies

Everyone is looking for the next Berkshire Hathaway (BRK.A), Warren Buffett's company.

One very good company in the mold of Berkshire Hathaway is the cash rich Leucadia (LUK), run for many years by super investors Ian Cumming and Joseph Steinberg.

Carl Icahn, another superinvestor, gives us Carl Icahn Enterprises (IEP), (Formerly American Real Estate partners (ACP)) and offers investors a way to invest with this great activist investor. Watch out for guru investors with a lot of cash to use.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
LUK	Leucadia	N/A	N/A	N/A
IEP	Carl Icahn Enterprise	N/A	N/A	N/A

O. Consumer Staples

Symbol	Stock Name	PEG	Forward PE	5 yr growth
PG	Procter and Gamble	1.60	18.07	11.31%
UL	Unilever	0.96	15.34	16.00%

P. Consumer Staples: Drinks and Beverages

Hansen (HANS) is a fast growing beverage company specializing in Energy Drinks.

Central European Distribution (CEDC) is a Polish drink and Vodka producer.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
PEP	Pepsi	1.74	19.22	11.03%
HANS	Hansen Natural	0.76	30.06	39.63%
CEDC	Central European Distribution	1.29	22.52	17.50%

Q. Consumer Discretionary: Gambling Equipment

Scientific Games (SGMS) makes equipment for Lotteries, Printed Products, and Diversified Gaming. Some say this is a recession proof stock.

International Game Technology (IGT) makes Gaming Equipment for Casinos.

Symbol	Stock Name	PEG	Forward PE	5 yr growth
SGMS	Scientific Games	1.06	23.94	22.66%
IGT	International Game Technology	1.69	25.36	17.20%

R. Industrials

Symbol	Stock Name	PEG	Forward PE	5 yr growth
GE	General Electric	1.47	16.31	11.09%
UTX	United Technologies	1.40	16.39	11.72%

S. Healthcare

Symbol	Stock Name	PEG	Forward PE	5 yr growth
GILD	Gilead	1.35	23.30	17.20%

Drink and Soda Stocks By the Numbers

In this article, we look at different Drink and Soda Stocks and look purely at the raw numbers. (Data taken from Yahoo Finance on Thursday, June 21, 2007):

Symbol	Stock Name	MyPEG	Forward PE	5 yr growth	Yield
HANS	Hansen Natural	0.77	22.80	28.60%	0%
CEDC	Central European Distribution	0.96	18.10	17.50%	0%
STZ	Constellation Brands	1.25	14.48	11.50%	0%
JSDA	Jones Soda	1.27	46.88	34.00%	0%
DEO	Diageo	1.30	17.22	10.50%	2.30
PEP	Pepsi	1.32	17.85	11.00%	2.30
BUD	Anheuser-Busch	1.52	17.13	9.00%	2.20%
KO	Coca Cola	1.58	18.15	8.50%	2.60%

In order to understand the chart, we have to understand the different elements.

MyPEG

MyPEG is my own variation of the PEG Ratio. A MyPEG of less than one means the stock is cheap relative to its growth. A MyPEG of greater than two means the stock is very expensive relative to its growth. More info on MyPEG in this link.

Forward PE

Forward PE is the Price divided by Forward estimated earnings. When choosing between a stock that has a PE of 15 and a growth rate of 15% vs. a stock that has a PE of 30 and a growth rate of 30% (both have a PEG ratio of 1), I'll prefer the former. The reason is that high PE's are often priced to perfection. Any miss and high PE stocks can get hit very hard. Stocks with Lower PEs have less expectations and have a greater margin of safety. Another reason is that I have more confidence in the forward PE than the 5 yr. estimated growth rate. So the results are better by preferring the lower PE stock given an equivalent PEG or MyPEG because the 5 year growth rate is given less importance. Lastly, stocks can't maintain 30% plus growth for long periods of time, so growers from 15-30% might be preferred.

5 Yr Growth

5 Yr Growth is an estimate by the analysts. As I discussed earlier, the higher the better, though some people such as the legendary Peter Lynch have suggested that buying fast stocks, but not too fast, might be a good idea (from Peter Lynch's One Up On Wall Street : How To Use What You Already Know To Make Money In The Market).

Yield

The higher yield, the better. If you have a high yield, high growth, and low PE, that's a good combination.

Symbol	Stock Name	EV/EBITDA	%Short	%Inst. Own
HANS	Hansen Natural	23.89	14.70%	60.70%
CEDC	Central European Distribution	16.51	10.20%	62.30%
STZ	Constellation Brands	9.81	11.40%	83.90%
JSDA	Jones Soda	105.68	26.30%	27.30%
DEO	Diageo	13.42	0%	18.70%
PEP	Pepsi	12.59	0.60%	68.50%
BUD	Anheuser-Busch	11.17	0.90%	63.00%
KO	Coca Cola	15.35	1.30%	64.50%

EV/EBITDA

Enterprise Value divided by Earnings Before Interest, Taxes, Depreciation and Amortization. It is another measure of valuation. The lower the Better. A value of 8 or less is very good.

% Short

The higher the percentage, the higher number of people who believe the stock should go down. However, the higher the percentage, the better for those who go long because if good news is to hit a stock, not only does the price go up, but all those people who are shorting have to "cover" (Buy a stock to fulfill their loan obligation to the broker) their short position further fueling the gains. This is often called a "short squeeze".

% Institutional Ownership

People have different theories on this. Some people, like Peter Lynch, prefer a stock without that much institutional ownership. Because once the big mutual funds discover the stock, this could propel the stock to multibagger (make many times your money on your original investment) heights. However, some prefer a higher institutional ownership because that means that mutual funds and other institutional investors are already buying the stock (and may have them in their approved to buy list), and when more money comes in, they may add to their position.

Conclusion

Based on all this and based on just the numbers, Hansen Natural (HANS) and Central European Distribution Corp (CEDC) seem to have the best Growth at a Reasonable Price ratings.

Note that there are other companies that were not looked at including AmBev (ABV), a South American Drink Company, and National Beverage Corp (FIZZ), because there was some missing information. They could still be very good investments, however.