Performance - Week Ending 02/12/2016

The Wax Ink Portfolio was down 0.3% for the week.

By comparison, the Dow was down 1.4%, the Nasdaq was down 0.6%, the S&P 500 was down 0.8%, the Russell 2000 was down 1.4%, and the Volatility Index, commonly known as the VIX, was up 8.6%.

Year to date, the Wax Ink portfolio is down 11.8%, the Dow is down 8.3%, the Nasdaq is down 13.4%, the S&P 500 is down 8.8%, the Russell 2000 is down 14.4%, and the VIX is higher by 39.5%.

The portfolio breakdown is 60% cash, 40% equities, and 0% bonds.

Baseline Valuation Estimates
Baseline Valuation Estimates are initial valuations which Accredited Investors, after completing their own due diligence, can either increase or decrease in accordance with their individual risk tolerance or investing philosophy.

Financial data used in the creation of each Baseline Valuation Estimate is the most recent company ANNUAL financial information as filed with the U.S. Securities and Exchange Commission.

The average baseline valuation estimate of all equities currently held in the Wax Ink Portfolio is $37.17. For the current week ending, the average market valuation of all equities currently held in the Wax Ink Portfolio is $27.47, making the current value spread (26.10%).

Fair Warning
WR Grace completed the separation of its construction products business on February 3, 2016 via a one for one distribution meaning for every share of WR Grace stock I owned, I received a like number of shares in the new company. The name of the new company is GCP Applied Technologies, Inc. (NYSE: GCP) and began trading on February 4, opening at $16.27. I am in the process of figuring out how to adjust the cost basis of my WR Grace shares and create a cost basis for the new shares. But for now I have added the new shares to the portfolio.

Hydrocarbon Prices
WTI Crude ended the week at $29.44, down 4.7%, while Brent Crude ended the week at $33.36, down 2.1%, creating a crude price spread of $3.92. On the other side of the floor Natural Gas ended the week at $1.97, down 4.4%, and RBOB Gasoline ended the week at $1.043, up 5.1%.

Year to date WTI Crude is down 20.5%, Brent Crude is down 10.5%, Natural Gas is down 15.8%, and RBOB Gasoline is down 17.9%.

Treasury and Bond Yields
The 5 Year Treasury ended the week at 1.18, down 3.3%, while the 10 Year Treasury ended the week at 1.73, down 4.4%. The 5 Year AAA Municipal Bond ended the week at 0.64, down 9.9%, and the 10 Year AAA Municipal Bond ended the week at 1.54, down 0.6%. Lastly, the 5 Year AAA Corporate closed the week at 0.92, down 10.7%, with the 10 Year AAA Corporate ending the week at 2.60, unchanged.

Year to date the 5 Year Treasury is down 32.2%, the 10 Year Treasury is down 23.1%, the 5 Year AAA Muni is down 48.4%, the 10 year AAA Muni is down 28.0%, the 5 Year AAA Corporate is down 51.6%, and the 10 Year AAA Corporate is down 11.0%.

Weekly Winners
This week's portfolio winners were rubber and tire king Goodyear Tire and Rubber Company (NYSE: GT), up 9%, cigarette paper maker Schweitzer-Maudit International (NYSE: SWM), up 3%, and specialty chemical company WR Grace and Company (NYSE: GRA), up 1%.

Weekly Losers
This week's portfolio losers were offshore supply boat company Tidewater (NYSE: TDW), down 21%, offshore construction contractor McDermott International (NYSE: MDR), down 12%, and independent oil and gas company Marathon Oil and Corporation (NYSE: MRO), down 10%.

Portfolio Duds
The portfolio's worst performing stocks remain municipal construction company Layne Christensen down 68% since being added to the portfolio, and offshore supply boat company Tidewater, down 62% since being added to the portfolio, independent oil and gas company Marathon Oil Corporation, down 48% since being added to the portfolio, building materials company Griffon Corporation down 21% since being added to the portfolio, and offshore construction contractor McDermott International down 24% since being added to the portfolio.

Baseline Valuation Worksheets
Archived worksheets may be downloaded by going to the Worksheets page at the site and selecting an industry which will move you to all of the worksheets I have updated for the selected industry.

Worksheets were either created or updated last week for the following companies. Please note that worksheets are updated or created basis the most current SEC 10-K ANNUAL filing.

Cintas Corporation (Nasdaq: CTAS) - FYE 05/2015

Ulta Salon, Cosmetics and Fragrance, Inc. (Nasdaq: ULTA) - FYE 01/2015

The Home Depot, Inc. (NYSE: HD) - FYE 01/2015

Paychex, Inc. (Nasdaq: PAYX) - FYE 05/2015

Linear Technology Corporation (Nasdaq: LLTC) - FYE 06/2015

The Boeing Company (NYSE: BA) - FYE 12/2015

Estimate Revisions and Additions
Baseline value estimates were either created or revised this week for Cintas Corporation ($47-$53), Ulta Cosmetics ($53-$65), Home Depot ($63-$64), Paychex ($33-$41), Linear Technology ($38-$45), and Boeing ($56-$71).

Have a great week.

Wax

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