Out Fox The $treet

The stock of Accenture Ltd. (ACN) has had a great run over the last couple of years as the company has grown earnings and repurchased shares. As the stock has nearly doubled, the buybacks have stalled leaving the company with less bang for the investment. As one of the world's leading management consulting, technology services and outsourcing organizations has seen earnings nearly double in the last few years, the stock has seen strong gains. The company, though, hasn't been able to increase the buyback amount and in fact spent less in fiscal year 2012 versus 2011. All signs that the insiders with the best information might consider the stock price expensive. Read the full article at Seeking Alpha. Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

--> This model was up 2.1% in September versus a 2.4% gain for the benchmark S&P 500. The model slightly under performed the market in September, which can happen in solidly positive months. The model is now up over 20% for the year. Trades As mentioned in the last several monthly reports, one goal of this model is to slowly trim the amount of positions back closer to 20 after reaching 26 a few months back due to mergers and partial positions. The position count remained at 24 at month end, but a partial position in Vale S.A. (VALE) was increased in order to fill out the position. The Gap, Inc. (GPS) was sold, as the position became the largest one in the portfolio after an incredible gain by the stock. After a 100% gain for the year, the Net Payout Yields (NPY) declined to the point that Gap was no longer attractive for this model. Read our Seeking Alpha article for more details. With the cash from the Gap sell, Motorola Solutions (MSI) was purchased ...

This model was down 7.7% in May versus a 6.3% loss for the benchmark S&P 500. In a rare occasion, the model underperformed the market by more than 100 basis points. While disappointing, this does happen sometimes. The benefit is that the stocks with large buybacks are able to purchase more shares at these cheaper prices. Trade Only one major position change was initiated in May with the addition of Ameriprise Financial (AMP) in two transactions. The company has a spectacular net payout yield exceeding 15% with the dividend portion at nearly 3%. The other major transaction was switching out of Phillips 66 (PSX) and back into a full position on ConocoPhillips (COP) after the spinoff back in April. After some research, ConocoPhillips provides the higher guaranteed yields while Phillips 66 remained uncommitted on buybacks. A half position in Home Depot (HD) was sold to reduce exposure to the home improvement sector since both Home Depot and Lowes (LOW) had become t...

December was yet another solid month on a absolute basis, with a 0.53% gain for this portfolio, but on a relative basis the portfolio underperformed the benchmark S&P 500 that was up 0.85%. For 2011, the portfolio was up 6.82% versus 0.0% for the benchmark. Despite all the volatility in the markets, the Net Payout Yields Model had a good absolute and relative performance for the year. 2012 Outlook  Since this portfolio is not dependent on fundamental analysis or economic forecasts, it isn't always prudent to focus on the prognosis for the stock market and economy. The whole goal is to find high net payout yielding stocks and then harvest the benefits of huge dividends and stock buybacks. In a way, let the management teams earn their money while investors enjoy the spoils. Naturally as an investment advisor with other active portfolios, I definitely have opinions on the market and economy but it just doesn't seem prudent to focus on them here. Anybody interested can vi...

Accenture (ACN) remains a key holding in the Net Payout Yields Model. After the close it reported earnings that beat estimates by $.02. Solid results as usual. Not much to say as ACN always reports solid numbers. The one issue worth noting is that it pointed out currency losses due to the stronger dollar in the last quarter. Not a big deal at this point, but it could become an issue down the road if the US Dollar continues to rally. Company only bought back $285M this quarter as well slightly lower than normal. Good summary from briefing.com: 4:10PM Accenture beats by $0.02, beats on revs; guides Q2 revs in-line; lowers FY12 EPS on FX, in-line, reaffirms FY12 revs guidance ( ACN ) 56.13 +0.10 : Reports Q1 (Nov) earnings of $0.96 per share, $0.02 better than the Capital IQ Consensus Estimate of $0.94; revenues rose 17.0% year/year to $7.07 bln vs the $6.86 bln consensus. Co issues in-line guidance for Q2, sees Q2 revs of $6.5-6.8 bln vs. $6.6 bln Capital IQ Consensus Estimat...

August was a decent month for this model with an active return of 1.02% (Portfolio was down 4.66% versus the benchmark S&P500 down 5.68%). Naturally on an absolute basis the results are disappointing, but this model is not designed to time the markets. The goal remains to outperform on the way down and remain even on the way up producing superior returns over time. Trades After several semi active months of trading especially in May and July, August saw no trades executed. Typically the model trades more in good markets as companies outgrow yields making them less attractive to keep. While down markets normally lead to higher yields and a improvement in the decision for keeping a security in the model. Largest Weights Lorillard (LO) remained the largest stock in the model as the tobacco stock was able to post a nearly 5% gain in the month. CSX Corp (CSX) remained a top weight even though the stock plunged. The railroad operator remains tied to a cyclical business and was the ...

After the close on Thursday, Accenture ( ACN ) reported earnings that surpassed earnings estimates. The company continues to report strong numbers with 21% revenue growth and 27% earnings growth. More important to us is that all though the stock traded at an all time high during the quarter at $58.21, the company bought back $644M worth of stock at an average price of $56.50. The stock remains a top five pick in our  Net Payout Yields (NPY) portfolio , which invests in stocks with high yields comprised of dividends plus stock repurchases. Read full article at Seeking Alpha . 

Yesterday,  Intel ( INTC )  upped its dividend to 72.48 cents (ok, what's up with the fractional cents?). This brings the dividend yield up to a very respectable 3.4%. Yet the dividend alone wouldn't make Intel a Net Payout Yield favorite. INTC also announced a $10B increase in the share repurchase plan, which increases the overall outstanding buyback to a whopping $14.2B.  See the rest of the article at Seeking Alpha . Subscribe to the Net Payout Yield Portfolio at Covestor - Net Payout Yields .  Disclosure: Long AAPL, CSCO, TXN, ACN. No position in INTC. 

Accenture (ACN) jumped roughly 8% today on the back of solid earnings released last night. Anybody following the Net Payout Yields would've been alerted to jump into this stock long before this report. Even after a big run the last few months, ACN has a solid dividend of 2% and repurchased $620M worth of shares during the last quarter providing a roughly 8% buyback yield. The total Net Payout Yield jumps to nearly 10% even with the jump in stock price. ACN raised full year guidance to a mid point of $3.12 a share easily exceeding the $3.04 estimate. Part of this is due to the $.04 gain in this quarter alone from the buybacks. Then again analysts know they plan to buyback shares so that should be factored into estimates. Lots of investors continue to slam buybacks but ACN provides an ample example of how they can work so masterfully. With the stock depressed over the last year, ACN used their good balance sheet and strong cash flow to buy back shares on the cheap. So cheap that ...