Upside moving trends
As of the end of December 2016, the JPMorgan Prime Money Market Fund (CJPXX)(CJPXX), Lowe Cos (LOW), Avago Technologies (AVGO), Humana (HUM), and Union Pacific (UNP) made up the top five long holdings of the JPMorgan Research Market Neutral Fund Institutional Class (JPMNX). The JPMorgan Prime Money Market Fund (CJPXX)(CJPXX) is a broader, traditional mutual fund managed by JP Morgan Asset Management. Notably, all of JPMNX’s top holdings except CJPXX were trading below their 20-day and 100-day moving averages as of January 29, 2016.
The graph above shows the moving averages, forward target price, and returns of top holdings of JPMNX. Avago Technologies, Humana, and Union Pacific were trading at 2%, 9.1%, and 16.2% below their respective 100-day moving averages. On the other hand, CJPXX was trading at 23.6% above its 20-day moving average as of the same date.
These one-year price estimates, according to the most recent Bloomberg survey, indicate an upside of to all the equity stock holdings of JPMNX. Avago Technologies was estimated to reach the highest, with an upside of 35.4% from its current levels. Similarly, Lowe Cos, Humana, and Union Pacific have yearly upside targets of 20.7%, 29.8%, and 19.2%, respectively. The forward 12-month EPS (earning per share) estimates for Lowe Cos (LOW), Avago Technologies (AVGO), Humana (HUM), and Union Pacific (UNP) are $0.59, $2.3, $1.4, and $1.1, respectively.
In the next and final part of this series, we’ll analyze the effect of adding JPMNX to an S&P 500 index (VFINX) portfolio.