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Commentary

What Investors Were Researching in September

International opportunities, income, and M&A activity were on investors' minds in September.

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Stocks rebounded in September, with the S&P 500 gaining more than 3% after slipping 3% in August.

The big news in the month was the Fed's surprise decision not to taper its bond purchases at its September meeting. The central bank had been preparing the markets for months that it was likely to begin taking its foot off the accelerator a bit. But worries about the fiscal situation and a downgraded growth forecast had the Fed staying put. The stock market soared on the announcement before pulling back slightly. Treasury bonds also rallied in the month. The yield on the 10-year bond started the month at 2.86% and climbed to nearly 3.00% before falling to 2.64%. 

Economic news pointed to continued slow, but reasonably steady, growth in the month. Inflation remained very low, consumer spending was more of a mixed picture, and there were some signs from retailers about softness through the holiday season. Morningstar director of economic analysis Bob Johnson still sees the data as consistent with 2.00%-2.25% GDP growth

Against this backdrop, what were investors checking out on Morningstar.com during the month? Below are the 25 most viewed stock, mutual fund, and exchange-traded fund Analyst Reports in September.

 Most Viewed Stock Analyst Reports in September 2013
Name Ticker Moat Star Rating September Return
Express Scripts ESRX Wide -3.3%
Apple AAPL Narrow -2.1%
Microsoft MSFT Wide -0.4%
Enbridge ENB Wide 1.9%
Kinder Morgan Ptns KMP Wide -2.1%
Rogers  RCI Narrow 9.7%
Coca-Cola
KO Wide -0.1%
General Electric GE Wide 4.1%
Vodafone VOD Narrow 8.7%
Kinder Morgan KMI Wide
-6.2%
Clorox CLX Narrow -1.2%
Baxter Intl BAX Wide
-4.9%
Exelon  EXC Wide
-2.8%
National Oilwell Varco NOV Wide 5.5%
Berkshire Hathaway BRK.B Wide 2.1%
Potash Corp POT Wide
5.5%
Abbott Labs ABT Narrow -0.4%
Halcon Resources HK None

-6.7%

Applied Materials AMAT Wide 16.8%
Canadian Natural CNQ Narrow 3.1%
Exxon Mobil XOM Wide -1.3%
J.C. Penney JCP None -29.4%
IBM IBM Wide 1.6%
AT&T T Narrow 0.0%
Verizon  VZ Narrow -1.5%
Source: Morningstar, Return Data as of Sept. 30, Star Ratings as of Oct. 3.

As a whole, stocks were higher in the month, but Morningstar.com readers showed plenty of interest in shares that had sold off in September. The most researched firm,  Express Scripts (ESRX), came under pressure as fears about health-care reform mounted. Our analysts think these worries are overblown and still see significant opportunity in this wide-moat firm

 J.C. Penney (JCP) landed in the top 25 as its shares plummeted nearly 30% after the company had a major equity issuance to raise cash to help firm up the troubled retailer's financial position.

The $130 billion  Verizon Communications (VZ) paid  Vodafone (VOD) for the 45% stake of Verizon Wireless that it didn't already own put both of these firms in the spotlight in September. Canadian telecom  Rogers Communications (RCI) also popped onto the list after Verizon's move to buy its wireless unit meant that it wouldn't bid for spectrum to enter the Canadian market.

 Most Viewed Open-End Fund Analyst Reports in September 2013
Name Ticker Morningstar Category Star Rating September Return
Vanguard Div Growth VDIGX Large Blend 3.1%
Oakmark Intl OAKIX Foreign Lg Blend 7.0%
Dodge & Cox Intl Stk DODFX Foreign Lg Blend 8.1%
Vanguard Wellington VWELX Mod Allocation 2.3%
T. Rowe Health Sci PRHSX Health 5.8%
Vanguard Convert Sec VCVSX Convertibles 3.2%
Yacktman YACKX Large Blend 1.2%
Dodge & Cox Stock DODGX Large Value 4.4%
FPA Crescent FPACX Mod Allocation 2.0%
Vanguard Sel Value VASVX Mid-Cap Value 5.0%
Dodge & Cox Income DODIX Interm-Term Bond 0.8%
PRIMECAP Oddsy Ag Gr
POAGX Mid-Cap Growth 6.7%
Vguard Wellesley Inc VWINX Cons Allocation 1.6%
Vanguard Cap Opp VHCOX Large Growth 5.5%
Artisan Intl Value ARTKX Foreign Lg Blend 5.1%
T. Rowe Cap App PRWCX Mod Allocation 2.2%
Dodge & Cox Bal DODBX Mod Allocation 3.1%
PIMCO Total Return PTTRX Interm-Term Bond 1.8%
Fidelity High Income SPHIX High Yield Bond 1.0%
Vang Hgh-Yld Tax Exmpt VWAHX Muni Ntl Interm 1.0%
Met West Ttl Rtn Bnd MWTRX Interm-Term Bond 2.6%
Vanguard PRIMECAP  VPMCX Large Growth 5.0%
PRIMECAP Oddsy Stk POSKX Large Blend 3.6%
Fidelity Sel Biotech FBIOX Health 8.9%
Sequoia SEQUX Large Growth 4.6%
Source: Morningstar, Data as of Sept. 30, Star Ratings as of Oct. 3.

Foreign large-blend funds had a great month. The category returned nearly 7%, and two Gold-rated funds,  Oakmark International (OAKIX) (now closed to new investors) and  Dodge & Cox International Stock (DODFX) landed in the top three most researched funds. 

Income remained a top priority for fund investors. Interest was high in core income-focused funds such as  Vanguard Dividend Growth (VDIGX) and more specialty products like  Vanguard Convertible Securities (VCVSX)


 Most Viewed ETF Analyst Reports in September 2013
Name Ticker September Return
Vanguard Dividend Appreciation VIG 3.8%
Vanguard Total Stock Market VTI 3.7%
Vanguard High Div Yield VYM 2.3%
WisdomTree Emerg Mkt Sm Cp Div DGS 7.2%
Vanguard FTSE Emerg Markets VWO 7.1%
Vanguard FTSE Developed Mkts VEA 7.5%
Vanguard FTSE Europe VGK 6.9%
Vanguard FTSE All-World ex-US VEU 7.2%
WisdomTree Emerging Mkt Equity DEM 7.0%
iShares Barclays TIPS Bond TIP 1.5%
Vanguard Growth  VUG 4.8%
Vanguard Small Cap VB 5.7%
Vanguard Consumer Stpls VDC 1.6%
PowerShares Sr Loan Port BKLN 0.1%
WisdomTree SmallCap Div DES 5.7%
Vanguard Energy VDE 2.5%
Vanguard REIT Index VNQ 3.3%
Financial Select Sector SPDR XLF 2.8%
JPMorgan Alerian MLP Index AMJ 2.2%
ALPS Alerian MLP AMLP 1.7%
iShares Core S&P Small-Cap IJR 6.2%
Vanguard Total Bnd Mkt BND 1.0%
iShares Nasdaq Biotech IBB 8.2%
Vanguard Extended Mkt Index VXF 6.0%
Vanguard Info Tech VGT 3.9%
Source: Morningstar, Data as of Sept. 30.

 Vanguard Dividend Appreciation (VIG) retained is most researched ETF crown in September. Investors also had a strong appetite for foreign-equity funds as  Vanguard FTSE Europe (VGK),  WisdomTree Emerging Markets SmallCap Dividend (DGS) and  Vanguard FTSE Emerging Markets (VWO) were among the most researched. ETF asset-flows data also revealed interest in international-equity ETFs with an estimated $12.8 billion flowing into these funds versus $11.8 billion into U.S.-equity ETFs.

Jeremy Glaser has a position in the following securities mentioned above: MSFT. Find out about Morningstar’s editorial policies.