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June 16, 2011 -

In This Issue:

Updates Released to Stock Prospector and Stock Analyst

We have recently released updates to ICLUBcentral's Stock Prospector and Stock Analyst software programs. To continue downloading data from StockCentral into these programs, you must download and install the updates using the auto-updater feature in each program.

To update the programs to the new releases, make sure that you're connected to the Internet, then select Help from the menu, then Check for Program Updates. The auto-updater will start and automatically download and install the update to the program. Once the download and installation is complete, click "Done."

The new version of Stock Prospector is version 2.7.0001. There are no other changes in this update.

The new version of Stock Analyst is version 3.2.6. There are two other changes to the program in this update (see a list of changes).

If you have any questions or problems with these updates, please contact ICLUBcentral Customer Support.

Making Sense of Take Stock, StockCentral, Toolkit 6, and the Investor Advisory Service
by Doug Gerlach,
President, ICLUBcentral Inc.

ICLUBcentral provides several tools and services that assist investors in evaluating stocks for their portfolios, such as Toolkit 6, our Windows software for stock analysis; the Investor Advisory Service, our award-winning, market-beating stock newsletter; Take Stock, our "instant stock analysis" tool available on our website; and the Roster of Quality Companies, a weekly rating of all public U.S. stocks.

Although they all have features that rate or evaluate companies for investors, they are designed for different purposes or for investors of varying levels of experience. Comparing the conclusions reached by each tool about the appropriateness of investing in a particular company at a particular price may differ, even if you analyze a company at the same time in our different programs.

Unique to all our software is a basis in the long-term, growth-oriented investing methodology first developed by the non-profit investor education organization BetterInvesting 60 years ago. Many of our tools go above and beyond the BetterInvesting orthodoxy, but the roots in this fundamental approach to stock analysis will be apparent in all our tools.

Read more....

Understanding Implied Growth in Toolkit 6
by Doug Gerlach,
President, ICLUBcentral Inc.

One of the many innovations in Toolkit 6 is the display of a company's implied growth rate as an aid in projecting a company's future earnings potential. Although the concept of implied growth (also known as "sustainable growth" or the "implicit growth rate") is not new, it may be unfamiliar to some Toolkit users. This quick tutorial on implied growth may help you to use this value properly in your Toolkit stock studies.

Ralph Seger, the retired president of the Investor Advisory Service, helped popularize the use of implied growth during his many years of writing and advising investors. As Seger explains: "A company's rate of return on its reinvested capital will be the same as the sustainable growth rate of the company's earnings. The assumption is that the fraction of after-tax earnings reinvested into the company at the rate of return on equity capital will furnish the funds required to sustain growth."

On a Value Line company report, see the second to last line in its display of data titled "Retained to Common Equity," or calculate the rate yourself as follows:

      % Average Return on Equity x (1 - Dividend Payout Ratio) = Implied Growth Rate

"This is a theoretical concept and not always realistic," Seger is quick to point out. "However, it does pay to look at the implied growth rate derived from this calculation and judge whether it is sufficient to support long-term growth."

In Toolkit 6, the implied growth rate is displayed on the screen where you input your selected future sales and earnings per share growth rates. You should refer to the implied growth rate when choosing growth rates of sales and earnings, and use it as a theoretical maximum of expected future growth.

In addition, as Seger points out, "If the implied growth rate falls somewhat short of expectations of future growth rate, see if the debt-to-equity ratio is rising at an unsustainable rate or there are other signs of stress in the capital structure."

Integrating the implied growth rate in your stock studies is just another way that Toolkit 6 can help you make better investing decisions for your and your club's portfolios.

June 16, 2011


We're ICLUBcentral Inc.
We develop high-quality software products and web services for individual fundamental investors, and powerful accounting tools used by the majority of US investment clubs.

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Madison Heights, MI 48071

ICLUB Links:
ICLUBinsider Past Issues
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Investor Advisory Service
Complete Roster

Events Calendar:
First Tuesday of each Month: Toolkit 6 User Group led by Doug Gerlach, ICLUBcentral Inc.

Third Tuesday of each Month: New Investment Club Orientation led by Doug Gerlach, ICLUBcentral Inc.

Doug Gerlach will also be speaking at the following events:

June 21, 2011: Investment Club Operations Webinar; Preparing Your New Investment Club for Success
Doug Gerlach, Speaker

July 5, 2011: Toolkit 6 User Group Webinar; Generating Revenue-Based EPS Estimates in Toolkit 6
Doug Gerlach, Speaker

July 12, 2011: Retail Investors Conferences; Doug Gerlach, Speaker

July 19, 2011: Investment Club Operations Webinar; Anyone Can Be a Club Treasurer! How to Manage the Club's Books in under One Hour a Month
Doug Gerlach, Speaker

Aug. 2, 2011: Toolkit 6 User Group Webinar; Doug Gerlach, Speaker

Aug. 4, 2011: Retail Investors Conferences; Importing, Exporting, and E-mailing Stock Studies
Doug Gerlach, Speaker

Aug. 16, 2011: Investment Club Operations Webinar; What's on Your Club's Watch List?
Doug Gerlach, Speaker

Sept. 15-18, 2011: BetterInvesting National Convention; Cincinnati, Ohio
Doug Gerlach, Speaker
ICLUBCentral, Exhibiting

Nov. 4-5, 2011: Puget Sound BetterInvesting Chapter Education Conference; Mercer Island, WA
Doug Gerlach, Speaker

Nov. 10-12, 2011: AAII Investor Conference; Las Vegas, Nevada
Doug Gerlach, Speaker
ICLUBCentral, Exhibiting

Submit Your Event!

Like 7-Eleven, we're not always doing business, but we're always open — go to the ICLUB Store and outfit yourself with the simple, yet powerful tools and services that smart investors have been using to grow their portfolios since 1989.

Got a Problem?
Support is here to help. You can reach them M-F, 9:30 AM-6:00 PM at 877-33-ICLUB (877-334-2582), or use the email web form at ICLUB Support.

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