Weekly Deep Value Stocks

Happy Sunday

Every week I run the same scan. Quality companies below their 200-day moving average.

The 200-day is one of those lines that actually matters. When good companies drop below it, long-term money starts looking.

But most stocks below their 200 deserve to be there. Cheap for a reason. So I filter for quality first.

Let’s dig in…

Quality Under its 200 day price Avg.

Every company gets scored on 4 pillars:

1. Profitable
The business earns strong returns on every dollar it invests. Not just "making money" —> making money efficiently.

2. Cash-Generating
Profits are real cash, not accounting tricks. Easy to fake earnings. Hard to fake cash in the bank.

3. Safe
Low debt, can pay its bills. Won't blow up if the economy gets rough.

4. Consistent
Actually making money from operations. No gimmicks, no one-time windfalls propping up the numbers.

Today’s Sponsor

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This Week's List

Perfect Scores (8/8)

Strong Scores (7/8)

What’s Standing Out

DECK 
Hoka's still ripping, UGG prints cash, balance sheet is clean (net cash). 33% ROIC sitting right at the 200 MA. This is the kind of name you want to buy when it goes on sale.

LULU 
Down 7% from the 200 MA. 27% ROIC, strong free cash flow, but the market's punishing it for slowing growth. Revenue's still growing (high single digits), just not at the pandemic pace everyone got used to. Valuation's finally compressed enough to get interesting.

META 
8% below the 200 MA with a net cash balance sheet. 21% ROIC. Yes, the AI capex is enormous and that's the bear case. But this thing still prints money. Rare to see it trade at a discount to a key technical level.

NFLX 
Biggest deviation on the list at -22%. Password crackdown worked. Ad tier's scaling. 24% ROIC with positive free cash flow. The subscriber anxiety era is over and the stock hasn't caught up yet. They have earnings coming out Tuesday so volatility expected.

This is a watchlist, not a buy list. Make sure to do your own work.
Not financial advice.

- John