MagicDiligence
Magic Recipe 0.05%
Deep Value -0.80%
Star List 0.95%
S&P 0.02%
Today's Performance (see long-term performance)

New Magic Recipe Stocks for 3/27/2016

A few interesting additions and subtractions from the Magic Recipe Spell this past week. For the changes in the Deep Value, Quality Growth, and Star List spells, click here.

The first stock to mention is Five Prime Therapeutics (FPRX). Five Prime is one of those classic "Magic Formula mirages" - a small development-stage biotech that just received a massive milestone payment. While the calculations and placement are legitimate, prospective investors should realize that these numbers are not sustainable long-term on the current basis of revenue.

We can't ignore the entry either of Valeant (VRX). Anyone who follows stocks has probably heard of this cluster, a once high-flying stock that is one of famous hedge fund manager Bill Ackman's largest holdings, the stock has fallen from $250 to $30 over the course of 9 months! While an interesting soap opera, the company is now going through a management change and a complete business strategy change, all while facing political pressure and an enormous debt load. That said, investors did believe this was a company worth almost 10 times its current valuation not even a year ago.

Here are the full lists:

Magic Recipe

Tickers dropping out:

Ambarella, Inc. (AMBA)
McKesson Corporation (MCK)
Insys Therapeutics, Inc. (INSY)
GNC Holdings, Inc. Class A (GNC)

Tickers entering:

Five Prime Therapeutics, Inc. (FPRX)
Valeant Pharmaceuticals International, Inc. (VRX)
Michaels Companies Inc (MIK)
Cato Corporation Class A (CATO)

10% Movers:

Five Prime Therapeutics, Inc. (FPRX) 11.74%
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