Valuentum Exclusive Analysis for the Discerning Investor

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Oct 20, 2022

Philip Morris Is One of Our Favorite High-Yielding Income Generation Ideas
Image Shown: Philip Morris International Inc expects alternative nicotine products will grow at a robust pace over the coming years, with an eye towards heated tobacco units and oral nicotine products. By capitalizing on those opportunities, the company aims to diversify its revenues away from traditional cigarette sales. Image Source: Philip Morris International Inc – 2021 Investor Day Event Presentation. Philip Morris is a strong cash flow generator with ample pricing power and a bright growth outlook. Underlying demand for its IQOS heated tobacco offerings remains robust and demand for its traditional cigarette offerings is holding up well, even in the face of substantial inflationary pressures weighing negatively on consumer spending power around the global. Philip Morris’ near term guidance indicates that it should remain a strong free cash flow generator in 2022, allowing the firm to stay on top of its payout obligations. Management remains committed to rewarding income seeking shareholders, and we continue to like exposure to shares of Philip Morris in our High Yield Dividend Newsletter portfolio.

Oct 20, 2022

PepsiCo May Be A Rare Winner in This Inflationary Environment
Image Source: PepsiCo Inc – Third Quarter of Fiscal 2022 Earnings Press Release. PepsiCo is leaning heavily on net pricing increases to offset cost input and foreign currency headwinds, and its strategy is paying off. The consumer staples giant remains a nice free cash flow generator and management is incredibly shareholder friendly, though in our view, we think it would be wise for PepsiCo to pare down its net debt load. We recently added PepsiCo to the simulated Best Ideas Newsletter portfolio on October 18, 2022.

Oct 19, 2022

Johnson & Johnson Reports Mixed 3Q Results, Plans to Spin Off Consumer Health Division Mid-to-Late 2023
Image Source: Johnson & Johnson. Johnson & Johnson is one of the top weightings in the simulated Dividend Growth Newsletter portfolio, and it has delivered tremendous stability at a time when the markets are facing considerable pressure. Year-to-date, Johnson & Johnson has fallen about 4% on a price-only basis, while the S&P 500 is down more than 18% so far in 2022. Macroeconomic uncertainty, inflationary pressures and currency headwinds will muddy operational results in the near term, and its planned spin-off of its ‘Consumer Health’ division as Kenvue in mid-to-late 2023 will complicate financials, but we still like Johnson & Johnson. Shares yield ~2.7% at the time of this writing.

Oct 18, 2022

Dividend Growth Newsletter Portfolio Idea Lockheed Martin Continues to Power Ahead in 3Q 2022, Showcases Strong 3% Dividend Yield
Image Source: Tomas Del Coro. Lockheed Martin recently raised its quarterly dividend rate to $3 per share, and the stock now boasts a ~3% dividend yield, which we like a lot. As it relates to all of 2022, Lockheed Martin is targeting an impressive $6+ billion in free cash flow, which helps support our fair value estimate range of $313-$495 per share (with emphasis on the high end) and its resilient Dividend Cushion ratio of 1.4. We’re sticking with shares of Lockheed Martin in the simulated Dividend Growth Newsletter portfolio at this time.

Oct 16, 2022

The Valuentum Learning Center
Image Source: Gaby Av. Learn about investing, Valuentum's investment process and more!

Oct 14, 2022

Banks Held Up in 3Q 2022 But Mortgage Market Dynamics and Consumer Health Are Big Economic Concerns
Image: Homebuyer mortgage payments on new homes have increased more than 50% since last year due to rising interest rates. We think this is a precursor to lower housing prices, which could have implications across the banking and financials sector. Image Source: Redfin. Third-quarter 2022 earnings reports from the money center banks weren’t bad, but we’re concerned about the impact of rising mortgage rates on originations coupled with weakness in asset values across the residential and commercial real estate markets. Consumer personal savings rates are already suffering as many seek to use revolving credit to deal with inflationary pressures. We like the Financials Select Sector SPDR (XLF) as the best way to play diversified exposure to the banking and financials industry, an ETF that we include in the Best Ideas Newsletter portfolio, but there's a lot to worry about, including global financial contagion risk from Europe.

Oct 14, 2022

NextEra Energy Is a Great Income Growth Idea
Image Shown: NextEra Energy Inc is a great income growth idea that complies with ESG investing standards as the company is investing heavily in renewable energy power generation assets and battery storage facilities. Image Source: NextEra Energy Inc – June 2022 IR Presentation. NextEra Energy is an attractive dividend growth idea that also complies with ESG investing standards, given its efforts on the renewable energy front. We appreciate the company’s robust capital investment pipeline as that underpins its bright adjusted EPS, operating cash flow, and dividend per share growth outlook through 2025. The utility is best of breed.

Oct 12, 2022

Serious Question: What Are You Looking At?
Image: Stocks with the largest 52-week losses, according to YahooFinance. We've handled the worst performers of 2022 quite handily, and the simulated newsletter portfolios are showcasing the importance of our methodology and processes. We expect things to get worse in the economy before they get better, but we maintain our view that there may be nothing better out there than a subscription to Valuentum to navigate these tumultuous times.

Oct 10, 2022

Stay Away from Mortgage REITs!
Image Source: Mortgage REITs have underperformed the broader stock market for years, and we don't think individual investors and financial advisors should be dabbling in the mortgage markets via these instruments. As we have said time and time again, stay away from mortgage REITs!

Oct 10, 2022

Best Idea Vertex Pharma Outperforming in 2022
Image Shown: Shares of Vertex Pharmaceuticals Inc, an idea included in our Best Ideas Newsletter portfolio, have performed incredibly well year-to-date through October 2022. Vertex Pharma’s performance this year has been stellar, and its financial position is rock-solid. The company has ample financial firepower to invest heavily towards commercializing its existing drug development pipeline and is well-positioned to ride out the numerous exogenous shocks seen of late (inflationary pressures, geopolitical tensions, and the increasing likelihood of a global recession in the near term). We continue to like shares of VRTX in the simulated Best Ideas Newsletter portfolio.