No. of Recommendations: 8
Each week, Value Line publishes a list of 100 stocks (from its coverage universe of ~1,700) with the highest appreciation potential between now and 2027-29, based on the mid-points of its individual price target ranges. VL notes that this list includes "some very risky issues" whose projected appreciation is based on turnaround stories that may or may not work out.
In last week's Selection & Opinion section, dated Aug. 16, it further culled this list, requiring a minimum safety rating of 2 (on a scale of 1-5), and minimum mid-point 3-5 year appreciation potential of 70%, compared to the current median of 50% for the VL universe. This more demanding screen also required an annualized rate of per-share earnings growth of at least 15% over the past five years. These requirements eliminated 88 of the stocks on the original list, leaving 12. They were listed in order of projected appreciation potential.
Markel finished in a three-way tie for second place on this list (tied with Akamai and Silgan) with 3-5 year appreciation potential of 90%. That would make the mid-point of its current VL 3-5 year price target range $2,872, starting from VL's "recent price" of $1,511.
Only Loews Corp., at 95%, finished higher on this list.
Other widely-held names on the list include Chevron (85%), Amazon (80%), and Alphabet (75%).
VL's forecasting record is decidedly mixed, but Markel's inclusion on this list indicates the share price has some catching up to do if it's going to reflect per-share earnings growth momentum, as Tom Gayner has been suggesting for some time.
Checking another statistical model, Dow Theory's Quadrix rating system, Markel's current price produces a "value" score of 79 on a scale of 1-100. Value is one of seven statistical categories that comprise a stock's overall Quadrix score and very often reflects a stock that has performed poorly. Categories such as quality, financial strength, earnings estimates and momentum are often better correlated to stock price performance.
For context, a sampling of other current Quadrix value scores: GM (96), Ford (92), Loews (90), Wells Fargo (88), Bank of America (82), Chevron (76), Occidental Petroleum (74), Chubb (71), Citigroup (71), Silgan (69), Dollar General (65), Lululemon (64), Akamai (63), Exxon (60), Lumen (47), Nike (47), Berkshire (42), Nextera (41), Broadcom (38), Alphabet (34), Nvidia (33), Meta (26), Carmax (25), Amazon (22), Microsoft (20), Chipotle (19), Boeing (12), Apple (11), Tesla (8), Sweetgreen (0).
