New Position on Covestor (CALM, MDT)

In the Under-Capitalized model, manager John Mooney attempts to invest in equities within sectors that other investors aren’t interested in and are, therefore, under-capitalized and have lowering price to earnings ratios than they may have when their sectors were popular. Recently, Mooney added Cal Maine Foods Inc (NASDAQ: CALM). CALM has been dealing with a voluntary egg recall during the latter half of 2010. They announced the recall on August 20th and the stock actually rose from a closing price of $30.34 on August  20th to a closing price of $32.51 on August 23rd. After that point, the stock price began falling, eventually dropping to a closing price of $26.74 on October 8th. Since then the stock price has risen slightly, closing at $27.78 on October 20th. CALM’s price to earnings ratio is also lower than many competitors.

In their Large Cap Value model, Bristlecone Value Partners uses a fundamental, bottom-up approach to invest in companies that are trading at a discount to their intrinsic value. Recently, they added Medtronic Inc (NYSE: MDT), a developer and manufacturer of device-based medical therapies across the globe, to the model. MDT has steadily growing sales, reporting $13.5 billion in sales in 2008, $14.6 billion in 2009 and $15.8 billion in 2010. Their price to earnings ratio is lower than competitors and its price has been falling pretty steadily since it closed at $45.79 on April 15th.  On October 20th, MDT closed at $34.70.