Bunny Stocks Portfolio

The Bunny Portfolio is a Growth and Value mechanical stock picking strategy created by John Dorfman (Thunderstorm Capital).
Let’s use the stock screening process to analyze it.

Investing Universe

Dorfman eliminates micro Cap Stocks.
  • Market Cap ≥$250 Million.


Primary Theme

Bunny is a Growth At Reasonable Price GARP strategy. In such strategies, we can usually consider that the primary theme is Growth Investing and that Value is used as secondary criteria as margin of safety.

However, in the case of Bunny stocks, both Growth and Value are part of the Primary theme.

The idea of the Bunny portfolio is to buy stocks that have high historical growth and are cheap. According to Dorfman, this happens mostly when a high growth stock is beaten down in price as investors think the high growth era has ended.

However, some stocks will still experience high growth - thereby surprising the market - and perform very well.

The 2 criteria used by Dorfman are:
  • Earnings Growth over the last 5 years ≥25%
  • PE ≤12
By buying several such stocks, Dorfman expects to catch of few of those that will keep on delivering high growth. This is really the idea of mechanical stock picking: buy a number of stocks that exhibit certain characteristics and hope that most of them (not necessarilly all) will perform as expected.

Secondary Theme

There is no secondary theme.

Ranking Go back to Top

Bunny Portfolio is balanced between Growth and Value. Dorfman performs 2 rankings and buy 5 stocks in each:
  • 5 highest "5 years EPS Growth"

  • 5 lowest "PE"

Bunny Stocks tend to be small-mid cap: this is due to high Growth, Low PE criteria.
In this case, a 10 stocks portfolio will be volatile. Unless you have a high risk tolerance, the strategy is recommended only for part of your portfolio.

Bunny Portfolio Screen Go back to Top

Here is a summary of the Bunny strategy:

Screening Theme Bunny Stocks
Investing Universe Market Cap≥250M
Primary Theme 5 years EPS Growth≥25%
PE≤12
Secondary Theme(s)  
Ranking 5 years EPS Growth
PE ratio
Number Of Holdings 5+5
Holding Period 1 year


Dorfman created the Bunny Portfolio in december 1999 and the strategy regularly outperformed the S&P500. It returned 28% annualized over 6 years (2000 to 2005) while the S&P500 lost money over the same period.

The Mechanical Investing Stock Screener does not allow to screen for Bunny stocks as MSN Deluxe screener does not include the "5 years EPS Growth".

Yahoo Stock Screener is better in this case. Check the following Bunny Portfolio Yahoo Screen (Be patient).

Notice that I set a maximum 50% for Growth to avoid too high growth stocks and a minimum PE of 5 to avoid too low PE Stocks.

After you’ve run the screen, click on “P/E” to rank through PE and select the top 5 (Make sure the ranking is through Low PE. Click a 2nd time on "P/E" if required). Then click on “Earnings Growth Past 5 Years” to rank through the same and select the top 5 to complete the portfolio (Again, check that the ranking is through High "Earnings Growth Past 5 Years").

Note: Yahoo Stock Screener must be installed.

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