Peter Pinches a Pickle

The omnipotent Wax Ink Portfolio was up 10.1% for the week.

By comparison, the Dow was up 0.6%, the Nasdaq was up 0.8%, the S&P 500 was up 0.7%, the Russell 2000 was up 1.4%, and the Volatility Index, commonly known as the VIX, was down 20.9%.

Year to date (there only 222 days until Tomb Sweeping Day), the Wax Ink portfolio is up 12.6%, while the Dow is up 10.4%, the Nasdaq is up 16.4%, the S&P 500 is up 9.1%, the Russell 2000 is up 1.5%, and the VIX is lower by 19.7%.

Portfolio Summary
The portfolio breakdown is roughly 54% cash, 46% equities, and 0% bonds. The current value of portfolio cash on a per share basis is $29.99 and the current value of portfolio equities on a per share basis is $24.92, making the average per share held price $54.91.

The average baseline valuation estimate of all equities currently held in the Wax Ink Portfolio is $26.92 and the average market closing price of all equities held in the Wax Ink Portfolio is $25.49, making the current portfolio fair value factor 5.3%.

PORTFOLIO NOTICE
I have finally started to update the holdings of the portfolio to reflect the bankruptcy and emergence from bankruptcy of Tidewater, Inc., so at this time the portfolio remains hugely skewed to the positive. The bankruptcy filing was essentially a 1 : 31.4143 reverse split, so as the number of shares I held decreased, the cost per share increased. At any rate, I am working through that as I have time.

Hydrocarbon Prices
WTI Crude ended the week at $47.87, down 1.3%, while Brent Crude ended the week at $52.41, down 0.6%, creating a crude price spread of $4.54, an increase of 7.8%. Distillate RBOB Gasoline ended the week at $1.6666, up 2.6%, and Heating Oil ended the week at $1.6223, up 0.1%, moving the Gulf Coast 3:2:1 Crack Spread (two barrels of gasoline + one barrel of heating oil – three barrels of crude oil) / 3) to $21.51, an increase of 9.5% for the week. Henry Hub Natural Gas ended the week unchanged at $2.89.

Year to date WTI Crude is lower by 10.9%, Brent Crude is lower by 7.8%, the WTI/Brent Crude Spread is higher by 46.5%, Henry Hub Natural Gas is lower by 22.3%, RBOB Gasoline is lower by 0.3%, Heating Oil is lower by 6.1%, and the Gulf Coast 3:2:1 Crack Spread is higher by 24.6%.

Treasury and Bond Yields
The 5 Year Treasury ended the week at 1.76, down 0.6%, while the 10 Year Treasury ended the week at 2.16, down 1.4%. The 5 Year AAA Municipal Bond ended the week at 1.60, up 10.3%, and the 10 Year AAA Municipal Bond ended the week unchanged at 2.45. Lastly, the 5 Year AAA Corporate closed the week unchanged at 1.84, with the 10 Year AAA Corporate ending the week down 1.8% at 2.78.

Year to date the 5 Year Treasury is down 6.9%, the 10 Year Treasury is down 10.7%, the 5 Year AAA Muni is down 9.1%, the 10 year AAA Muni is down 4.3%, the 5 Year AAA Corporate is down 10.7%, and the 10 Year AAA Corporate is down 8.3%.

Fair Warning
I am a deep value, long-term buy and hold investor with an average equity holding period of 60 months (1825 days).

Disclosure
Wax Ink has a long position in Tidewater, Inc.

Worksheet Changes and Notes
The worksheet continues to evolve, with changes to the RETURN ON $10K section becoming more centered on a 5 year period as opposed to a 10 year period, something you will start to notice over the next several weeks. I also continue to shorten the WHAT THEY DO section, trying to keep that information to the barest of minimums, and have added a RESEARCH NOTES section.

Baseline Valuation Estimates and Worksheets
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 SEC 10-K ANNUAL financial data as reported to the U.S. Securities and Exchange Commission.

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
Worksheets were either created or updated during the week for the following companies.

Gentex Corporation (Nasdaq: GNTX) - FYE 12/2016
Lear Corporation (NYSE: LEA) - FYE 12/2016
Lydall, Inc. (NYSE: LDL) - FYE 12/2016
Tidewater, Inc. (NYSE: TDW) - FYE 03/2017

Baseline Valuation Estimates
Baseline valuation estimates are determined through fundamental analysis of the listed company's most recent annual financial information and are intended as a starting point for continued due diligence. Baseline valuation estimates were either created or updated during the week for the following companies:

Gentex Corporation - $24
Lear Corporation - $97
Lydall, Inc. - $35
Tidewater, Inc. - $9

Current Growth Estimates
Current growth estimates are determined utilizing current pricing levels, year over year earnings growth, dividend yield, the current PE ratio, and an earnings growth estimate. Because current growth estimates are EXTREMELY volatile, what is presented here is a single current growth estimate. Current growth estimates were either created or updated during the week for the following companies:

Gentex Corporation - $20
Lear Corporation - $184
Lydall, Inc. - $53
Tidewater, Inc. - ($96)

Current Momentum Estimates
Current Momentum estimates are determined by utilizing current pricing levels, current earnings, year over year earnings growth, estimated future earnings growth, and current bond yields. The use of future anything makes the estimate result EXTREMELY volatile. Current Momentum estimates were either updated or created during the week for the following companies:

Gentex Corporation - $22
Lear Corporation - $277
Lydall, Inc. - $39
Tidewater, Inc. - ($9)

Future Value Estimates
Future Value estimates utilize year over year price changes and year over year dividend payments to determine a stock return on investment. The stock return on investment is then used to advance the recent price year by year for a 5 year period. Future Value estimates contain EXCESSIVE risk because past performance is not a guarantee of future returns. Future Value estimates were either updated or created during the week for the following companies:

Gentex Corporation - $27
Lear Corporation - $291
Lydall, Inc. - $144
Tidewater, Inc. - $23

Investment Investigation Summaries
Gentex Corporation - Under Valued - The current baseline valuation and key performance indicators (KPIs) support investment investigation

Lear Corporation - Fully Valued - The current baseline valuation and key performance indicators (KPIs) are mixed regarding support for investment investigation

Lydall, Inc. - Fully Valued - The current baseline valuation and key performance indicators (KPIs) are mixed regarding support for investment investigation

Tidewater, Inc. - Bankruptcy - The company is working through a bankruptcy filing


Have a strong week!!
Wax

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