Next up' CPL

Looking at my screens this month it felt like I'd developed tunnel vision. All I could see were companies I'd included in the Thrifty 30 portfolio, or companies I'd rejected. There must be more, surely'

So I configured Sharelockholmes to produce a list of companies that had been profitable over 1, 3, 5
and 10 years, that were not in negative equity, and had market capitalisations over ''5m.

There are 400 companies in that list, which meet my minimum quality requirement.

I dumped the list into a spreadsheet to calculate each company’s earnings yield, dividing average return on equity over the last ten years by price to book value, and filtered out any company with a yield of less than 10%.

Then I filtered out various undesirables, miners, housebuilders and financial services companies, mainly.

There remain 142 companies in the list and no matter how I sort it, sprinkled throughout are interesting companies. Companies I’ve fancied in the past, like Dechra Pharmaceuticals, that I thought too expensive. Old favourites that have fallen on hard times, like RM. Massive companies, like AstraZeneca, and lots of Thrifty 30 companies of course.

Top of the list is reject Bloomsbury but next in line CPL an Irish recruitment company that also features in my bargain screen. I hadn’t intended to look at CPL, unemployment has tripled in Ireland in the last five years and it may stay that way for a long time, but looking at CPL’s earning power in this screen makes me think the company could be a bargain regardless. Despite Ireland's economic woes, in its latest year CPL earned 11% return on equity according to Sharelockholmes.

I shot a 140 character query into Twitter asking if any investors had come across it. Blogger Philip O'Sullivan replied:

Come across it? I used to cover it when I was an analyst! Great company & mgmt. Will blog about it later today.

So there you go, next up for consideration is CPL. Here's Philip's post.

And hopefully there are many more in my screen, which, I think, almost captures the full spectrum of value. It's far too big to put in a web page, but here's the spreadsheet.