Nine for Nine Series – Intro
Over the next nine weeks, the site will be releasing a series detailing the very best nine publicly traded companies within nine specific industries. In total, there will be 81 companies reviewed over the nine weeks. The companies will range from powerful technology companies to global financial services to everyday products. The series will not be ranking which are the vastly superior companies over others, rather providing comprehensive financial data that makes each a part of the overall nine.
The process of selecting these very companies was done by looking objectively through the sector listing. Once a good company was found, their name was put on an overall list to be further examined for the final master list. Many of these companies are notable and familiar to the everyday American; however, there will be a handful of businesses you may not recognize. This can be the opportunity to learn about a company that could be the next position in your portfolio.
The industries were chosen based on the collection of companies. Once the master list was complete, the next step was to identify which industries each of the companies belonged to. A few businesses could be debated whether they should fall under a different group than the specific one they have been assigned to. The titles of a few industries have been self-created to align with the overall operations of the businesses within the group.
Here are the titles of the nine industries that will be presented in this series:
• Communication & Entertainment
• Everyday Products
• Financial Services
• Food & Beverages
• Retail Giants
• Transportation & Travel
First glance at the list shows the financials and technology industries. Normally these are both their own sectors with industries within them, but you will notice the financials are split between banking and financial services. This is because there were an abundance of quality companies within the sector. As for technology, sure there is a great deal of tech firms changing their respective fields, but overall there were a select group that stood out from the pack.
Yes, I know you may already be attempting to guess which nine are within the technology field or say to yourself “the financials are obvious”. I have no doubt you will be able to name half of the list, but rest assure it will be difficult to predict the exact nine. Some will be industry leaders and a few will be companies you do not currently have on your radar.
As a note: all companies listed are from the perspective of a long term investment orientation. There are not any penny stocks on the list. Also, exchange traded funds, real estate investment trusts, and American depositary receipts are excluded. All 81 companies are U.S based businesses.
In order to be considered for a spot on each industry’s list, every company had to be sized up to a set of key factors. One for instance is the minimum length of time as a publicly traded company. Any companies that were recently introduced as an initial public offering, within the last three years, was excluded from the final roster. The track record of a company’s financials has to be accessed for more than three years to fully gauge its previous and future potential.
Although amongst other great brands, every company must be a top contributor and supplier of product or service in their respective niche. If a company holds a small piece of the industry’s market share, then it cannot be considered one of the top choices for this series, and furthermore cannot truly be considered such, if the business lacks a competitive advantage. Product or service dominance is important to ensuring an increased customer base over the longevity of the company.
Dividend paying stocks are not a requirement, as issuing cash to investors does not automatically translate to sustainable growth. These chosen companies are poised to maintain their position within their market and experience steady (rapid for some) growth in value for shareholders. Value is the most critical element for shareholders – will the value of my investment appreciate over its holding period?
Depleting assets and ascending liabilities are factors to always watch in evaluating whether a business is a strong or weak performer. The candidates have to present strong financial conditions in prior years, present fiscal numbers, and an anticipated growth trajectory that aligns with the objectives of the business. Due to the majority of these companies being the leader in their industry they will almost certainly show a constant increase in performance over the years.
Innovation, adaptability, and creativity is a grouped component that is also an area of focus. Being able to adjust during a moving industry to develop new ideas, products, or services that will command new and existing consumer purchases is an integral moment for businesses to continue to flourish. Many of these companies seem to be able to do this routinely, while others use their current dominant product or service and make it so superior above its competitors that customers have no choice but to buy the best.
Who Will Make The Cut?
There will be some big names. There will be some bigger names. There will be companies you have heard of, but are not really sure what they do or how successful of a company they are. There will also be a few companies you may have never heard of, and will now be introduced to.
The particular industries have been presented, but the companies chosen will not be released until each week’s post is released. Here is one hint: each industry has at least one company that is a component of the Dow Jones Industrial Average. Stay tuned and subscribe to the blog to receive the weekly releases.
This series is not suggesting to invest in any particular company, rather presenting some of the widely known and unmentioned great companies, to potentially help you understand what they do, who they are, and how financially strong they may be.