Valuentum Exclusive Analysis for the Discerning Investor

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May 28, 2021

Dividend Increases/Decreases for the Week May 28
Let's take a look at companies that raised/lowered their dividend this week.

May 27, 2021

Dick’s Sporting Goods Soars, Reports Record First-Quarter Sales, Highest-Ever Quarterly Earnings!
Image Shown: Dick's Sporting Goods' stock price soared following the release of its first-quarter fiscal 2021 earnings report and robust guidance for the remainder of the year. We added the sporting goods retailer to the Dividend Growth Newsletter portfolio last November, and we continue to like shares. Dick’s Sporting Goods surprised the market to the upside in a big way when it reported first quarter earnings for fiscal 2021 on May 26. Management is targeting non-GAAP earnings per share for fiscal 2021 in the range of $8.00-$8.70, implying shares of the sporting goods retailer are trading at just 11.3 times the high end of this year’s earnings guidance. A solid balance sheet and strong free cash flow generation support the company’s dividend growth profile. We continue to like how Dick’s Sporting Goods is positioned for the long haul, and it remains an idea in the Dividend Growth Newsletter portfolio.

May 26, 2021

Cisco Systems’ Financials Remain Pristine, Growth Outlook Improving
Image Shown: Shares of Cisco Systems initially moved lower after the firm reported its latest earnings update, and management provided near-term guidance that disappointed investors. However, shares of Cisco Systems quickly resumed their upward climb as the tech giant’s financials remain rock-solid. We continue to be huge fans of Cisco Systems. On May 19, networking hardware and enterprise software giant Cisco Systems reported third-quarter fiscal 2021 earnings (period ended May 1, 2021) that beat consensus top- and bottom-line estimates. The firm’s GAAP revenues grew by 7% year-over-year and its GAAP operating income moved higher by a little over 1% year-over-year, with its ‘Security’ offerings leading the way as that segment’s revenues grew by 13% year-over-year last fiscal quarter. Though investors were initially underwhelmed by Cisco Systems’ near-term guidance covering the current fiscal quarter, the company remains a free cash flow generating machine with a fortress-like balance sheet. Shares of CSCO quickly resumed their upward climb after initially falling when Cisco Systems’ latest earnings report was published. We include Cisco Systems as an idea in both the Best Ideas Newsletter and Dividend Growth Newsletter portfolios. The trajectory of the company’s financial performance is beginning to turn around after Cisco Systems faced enormous headwinds in the recent past due to the coronavirus (‘COVID-19’) pandemic. Looking farther down the road, Cisco Systems’ growth outlook is quite bright, and we are big fans of the tech giant. Shares of CSCO yield ~2.8% as of this writing.

May 24, 2021

Crown Castle Is a Great Income Growth Idea
Image Shown: Crown Castle International Corp has an expansive portfolio of shared wireless infrastructure assets that covers every major market in the US. Image Source: Crown Castle International Corp – First Quarter of 2021 IR Earnings Presentation. We're huge fans of Crown Castle and believe the REIT has a promising dividend growth outlook. Looking ahead, the ongoing buildout of 5G wireless infrastructure in the US, the Internet of Things (‘IoT’) trend, and the potential emergence of smart cities supports the outlook for data demand and ultimately Crown Castle’s ability to grow its cash flows. Its expansive portfolio includes 40,000+ towers, ~80,000 route miles of fiber, and ~80,000 small cell nodes. According to Crown Castle, the REIT has a presence in every major US market. Crown Castle’s contracts generally are long term in nature and come with rent escalators and other provisions that are favorable for the REIT. As of this writing, shares of CCI yield ~2.9%.

May 21, 2021

Walmart’s E-Commerce Growth Supports Long Term Dividend Strength
Image Source: Mike Mozart. There are a number of dividend growth stocks that are on our radar, and Walmart is one of them. The company’s e-commerce and omni-channel initiatives have positioned it well for the long haul, and its free cash flow generation covers its cash dividends paid by a large margin. Strong comparable store sales momentum has continued into calendar year 2021 for Walmart, and we’re expecting another solid year of fundamental performance at the company. Walmart’s shares yield ~1.5% at last check, and we believe the company has years of dividend growth ahead of it.

May 21, 2021

Dividend Increases/Decreases for the Week May 21
Let's take a look at companies that raised/lowered their dividend this week.

May 20, 2021

Dividend Growth Opportunity Home Depot Posts a Solid Earnings Report
Image Source: Home Depot Inc – First Quarter of Fiscal 2021 Earnings Press Release. New home construction activity along with do-it-yourself (‘DIY’) and do-it-for-me (‘DIFM’) activities remains robust in the US, which is great news for Home Depot. On May 18, Home Depot reported first quarter fiscal 2021 earnings (period ended May 2, 2021) that beat both consensus top- and bottom-line estimates. Home Depot’s GAAP revenues rose 33% year-over-year and its GAAP operating income grew 76% year-over-year as the home improvement and construction retailer reported strong demand from both its professional and retail customer base. We're huge fans of Home Depot and include the company as an idea in the Dividend Growth Newsletter portfolio. Shares of HD yield ~2.1% as of this writing.

May 18, 2021

AT&T Right-Sizing Dividend, WarnerMedia Joining Forces with Discovery
Image Shown: AT&T Inc’s WarnerMedia unit is joining forces with Discovery Inc. This transaction, if it goes through as planned, will create another giant in the video streaming services industry. Image Source: Discovery Inc – Discovery Joining Forces with WarnerMedia IR Presentation. Despite the upcoming rightsizing of its dividend payout in light of a pending spin-off, the telecommunications and media giant AT&T continues to be one of our favorite income generation ideas. We're not making any changes to the newsletter portfolios at this time, and the recent news indicates AT&T’s balance sheet is about to improve significantly.

May 18, 2021

German Industrial Conglomerate Siemens Remains an Attractive Income Generation Idea
Image Shown: Siemens AG sees the global industrial economy staging a recovery from the COVID-19 pandemic, which in turn supports the firm’s outlook. The company raised its full-year guidance when Siemens published its latest earnings report. Image Source: Siemens AG – Second Quarter of Fiscal 2021 IR Earnings Presentation. Siemens has identified a number of growth avenues and is leaning on its digital capabilities to bring various industrial processes into the 21st Century. Siemens generates strong free cash flow, has a promising growth outlook, and its ‘A-rated’ long-term credit rating is impressive. Shares of SIEGY have been on a nice upward climb during the past year, as investors continue to warm up to its promising growth story. There could be room for substantial upside as the global economy recovers from COVID-19, and investors get paid a nice ~2.5% dividend yield to have exposure to this global industrial powerhouse. We think Siemens could be an interesting income generation idea for consideration.

May 17, 2021

Best Idea Disney’s Outlook Is Bright and Getting Brighter
Image Source: The Walt Disney Company – December 2020 Investor Day Presentation. The Walt Disney Company reported second quarter fiscal 2021 earnings (period ended April 3, 2021) that beat consensus bottom-line estimates but missed consensus top-line estimates. Investors were dismayed that the company’s paid video streaming subscriber base did not grow by as much as expected. However, we are not worried as Disney’s outlook is bright and getting brighter.