Morningstar Runs the Numbers
We take a numerical look through this week's Morningstar research. Plus, our most popular articles and videos for the week ended Jan. 26.
Inspired by Harper's Index (with a tip of the hat to FiveThirtyEight's Significant Digits blog), Morningstar Runs the Numbers uses a numbers-based approach to highlight recent Morningstar research, along with some outside news stories.
Morningstar announced its Fund Manager of the Year award winners in four categories. See the full list of winners here. You can also watch an interview with each of the four winners here: Steven Wymer, Fidelity Growth Company (Domestic Stock); Sarah Ketterer, Harry Hartford, and Team, Causeway International Value (International Stock); Michael Collins, Robert Tipp, Richard Piccirillo, and Gregory Peters, Prudential Total Return Bond (Fixed-Income); and David Giroux, T. Rowe Price Capital Appreciation (Allocation and Alternatives).
The Dividend Yield Focus Index uses both backward-looking and qualitative forward-looking measures to find high-yielding stocks that are financially healthy enough to sustain their dividend. During the latest reconstitution, we added nine stocks that pass our strict requirements for high yields, sustainable competitive advantages, and financial health.
The New York Times wine critic Eric Asimov compiled a list of 20 wines under $20. The $20 price is crucial, Asimov explains. Though budget-minded shoppers may balk that the wines on the list cost more than $10, for the slightly higher price, "the level of interest and pleasure in the wines increases exponentially," he said.
The first part of the year is IRA season because you have until your tax filing deadline, April 17 in 2018, to make an IRA contribution for the previous year. If you have a time horizon of at least 10 years and you are looking for a core long-term holding that you will add to in the years ahead, it's hard to go wrong with a very inexpensive total stock market index fund or exchange-traded fund. Here are three of our analysts' top picks for building your IRA.
Over the long run, long-short funds can provide diversification benefits if they are able to capture certain factor exposures that do not necessarily overlap with the factors driving the performance of the S&P 500. And unlike balanced funds, which hold a mix of equities and bonds, these funds are not exposed to interest-rate risks. Senior analyst Patty Oey takes a closer look at five long-short funds in this very heterogeneous category.
Starbucks (SBUX) began the fiscal year with a slow start, putting it into a hole regarding its full-year outlook and raising questions about menu, operational, and marketing strategies. Consumer sector strategist R.J. Hottovy doesn't think this implies any brand degradation or competitive issues, however. In fact, Hottovy plans to raise Starbucks' $66 fair value estimate despite the soft U.S. results, due to a lower long-term tax rate. "We still see shares as undervalued while also offering a compelling capital-allocation story," he said.
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