Wal-Mart Stores, Inc. (WMT), Carriage Services, Inc. (CSV), American States Water Co (AWR): Is There Still Time to Buy Into the Ultimate Defensive Portfolio?

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Back in January, surrounded by uncertainty in the market, I put together an article called the ultimate defensive portfolio, highlighting four stocks that I believed would protect any investor against market tantrums and provide a decent return no matter what happened in the wider market.

Nearly seven months on and the market has hit new all-times highs followed by extreme volatility and 300+ point moves to the downside. Despite all this, how has the portfolio performed and is there still time to buy?

Wal-Mart Stores, Inc. (NYSE:WMT)


Company Return
Wal-Mart Stores, Inc. (NYSE:WMT) 8.8%
Carriage Services, Inc. (NYSE:CSV) 44.9%
American States Water Co (NYSE:AWR) 8.9%
Reynolds American, Inc. (NYSE:RAI) 14.8%
Total Equally Weighted 19.3%

Overall, the whole portfolio has beat the S&P 500 by 19.3%, but the majority of this gain was thanks to Carriage Services, Inc. (NYSE:CSV), which, at one point, was up an impressive 45%. That said, none of the stocks significantly underperformed the index and the worst performer, Wal-Mart Stores, Inc. (NYSE:WMT), only underperformed by 1.55% — including dividends this return rises to 10.2% (American States has the same total return).

Is there still time to buy?

After the last six months, the market has moved significantly and the situation has changed, however, one of the best things about defensive stocks is that their outlook is long-term and not affect by short-term movements. That said, after the recent volatility in the markets, are these stocks still buys or should investors hold fire for now?

Carriage Services

I originally selected Carriage Services, Inc. (NYSE:CSV) due to the company’s low valuation in relation to its peers and the company’s impressive predicted growth rate. Well, it achieved the growth in the first quarter; EPS grew 21.4% to $0.34, while cash flow grew 314% to $9.1 million. Moreover, Carriage Services, Inc. (NYSE:CSV) is in line to increase EPS 92% to $1.23 for full year 2013, putting it on a forward earnings multiple of 14 — not much higher than the valuation in the original article.

I originally selected Carriage Services, Inc. (NYSE:CSV) for its impressive predicted growth and low valuation and it looks like the company is well on the way to achieving its growth and the valuation is still low, and on that basis, the stock is still a defensive buy.


Wal-Mart Stores, Inc. (NYSE:WMT) was originally selected for its size and history and in this short period, nothing has changed. The company sold off slightly when it reported results that came in below expectations during May but this provides a good buying opportunity.

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