Valuentum Exclusive Analysis for the Discerning Investor

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Jan 31, 2020

Dividend Increases/Decreases for the Week Ending January 31
Let's take a look at companies that raised/lowered their dividend this week.

Jan 30, 2020

AT&T Continues to Follow Through With Its Mission
Image Source: AT&T Inc – Fourth Quarter and Full-Year Earnings Presentation. One of our holdings in the High Yield Dividend Newsletter portfolio, AT&T, reported full-year and fourth quarter results for 2019 on January 29. Shares of T sold off modestly on the mixed report (adjusted non-GAAP EPS beat consensus estimates but revenues fell short of expectations), and now shares of T yield ~5.6% as of this writing. We continue to like what we see in AT&T as management is delivering on major value creating initiatives: deleveraging, margin expansion, and ultimately free cash flow growth. More information on the High Yield Dividend Newsletter >>

Jan 30, 2020

Debt-Free Facebook’s Free Cash Flow Surges 38%, Adds to Buybacks
Image Source: Facebook Q4 2019 slides. Revenue growth at Facebook remains solid, if not impressive. The market didn’t like Facebook’s fourth-quarter 2019 report, but we didn’t see anything to be concerned about. Revenue is growing like a weed, the firm’s operating margins have come roaring back, free cash flow is surging, its balance sheet is net-cash-rich with no debt, and the firm is buying back underpriced stock. We think the market is too focused on the annual reported numbers and less focused on the many opportunities Facebook has ahead of it. While revenue growth will inevitably slow for a huge company as Facebook and cost pressures will remain prevalent, this company is doing well. The firm remains a key holding in the Best Ideas Newsletter portfolio. Our fair value estimate is unchanged at $234 per share.

Jan 30, 2020

Latest Write-ups, Our ALA Excursion and Apple
Find links to our latest research in this note. Value Trap continues to gain traction in the public domain. We'll talk Apple and let you know what we're watching after the close January 29.

Jan 29, 2020

Starbucks Reports Earnings, Coronavirus to Hurt China Sales
Image Shown: How Starbucks Corporation views its competitive strengths. Image Source: Starbucks – December 2019 IR Presentation. Starbucks is trading at the upper end of our fair value range estimate, and given the headwinds facing the company in China (in terms of the competitive pressures from Luckin and the ongoing coronavirus overbreak) we see shares as fully valued as of this writing with room for meaningful downside. Its large net debt load is another concern. Shares of SBUX are priced for perfection, but exogenous headwinds could end up derailing its near-term growth trajectory.

Jan 29, 2020

The Great Guyanese Oil Boom
Image Shown: A drill ship floating in open waters. Image Source: Exxon Mobil Corporation – 2019 IR Presentation. Guyana’s economy of ~780,000 people is about to experience the oil boom bonanza of a lifetime, even in the relatively subdued oil price environment Exxon Mobil is currently operating in, as substantial royalties and taxes are set to fill the government’s coffers. That will allow for major public investments in healthcare, education, infrastructure, and so much more. Given the relatively small size of Guyana’s population, there will be a lot of new funds to go around. For Exxon Mobil and its partners, turning ~750,000 barrels of gross daily crude oil production capacity online by 2025 would be quite the achievement. In less than five years, the consortium went from hitting it big on the exploration side to reaching first-oil, and in ten years, the group plans on turning Guyana into one of the world’s largest oil exporters on a net basis. However, please keep in mind that big projects like these are contending with material mature field declines across Exxon Mobil’s upstream portfolio. Guyana is just part of the puzzle for Exxon Mobil.

Jan 29, 2020

Why We Like Lockheed Martin as a Defensive Dividend Growth Play
Image Source: Lockheed Martin Corporation – Third Quarter Fiscal 2019 Earnings Presentation. On January 13, 2020, we announced we were making some major changes to our newsletter portfolios, and that included adding major defense contractor Lockheed Martin Corporation to the Dividend Growth Newsletter portfolio with a modest 2.5%-3.5% weighting. Lockheed Martin is the lead contractor on the massive F-35 fighter jet program, has an expansive slate of weapon systems offerings (including the Javelin and Paragon systems), owns helicopter company Sikorsky (which sells aircraft for military, governmental, and civilian purposes), and offers a wide range of other defense related products and services (radar, sensors, etc.). The company is also the lead contractor on NASA’s Orion project, which is being designed for deep space exploration.

Jan 28, 2020

Johnson & Johnson Closes Out Fiscal 2019 With a Strong Fourth Quarter Report and Promising Fiscal 2020 Guidance
Image Shown: A look at some of Johnson & Johnson’s best selling products. Image Source: Johnson & Johnson – Fourth Quarter Fiscal 2019 IR Presentation. Best Ideas Newsletter and Dividend Growth Newsletter portfolio holding Johnson & Johnson reported fourth quarter and full-year earnings for fiscal 2019 on January 22. We liked what we saw as the company proved its fiscal 2019 wasn’t as bad as first feared, and furthermore, that Johnson & Johnson’s outlook remains bright as indicated by management’s guidance for fiscal 2020.

Jan 28, 2020

Intel Roars Higher
Image Shown: Intel Corporation, a top weighted holding in our Dividend Growth Newsletter portfolio and a medium weighted holding in our Best Ideas Newsletter portfolio, posted a tremendous fourth quarter report for fiscal 2019 on January 23. Shares of INTC marched meaningfully higher on January 24. Image Source: Fourth Quarter Fiscal 2019 Earnings IR Presentation. A top weighted holding in our Dividend Growth Newsletter portfolio and medium weighted holding in our Best Ideas Newsletter, Intel Corp posted blowout earnings on January 23. Full year revenue for fiscal 2019 hit a record of $72.0 billion on a GAAP basis, up 2% year-over-year, while GAAP diluted EPS rose by 5% to $4.71 (on a non-GAAP basis, diluted EPS was up 6% year-over-year, hitting $4.87). Intel beat both top- and bottom-line consensus estimates and guided for a strong fiscal 2020. Shares of INTC now yield ~1.9% on a forward-looking basis as of this writing after management pushed through a 5% sequential dividend increase in conjunction with the record earnings report.

Jan 24, 2020

Dividend Increases/Decreases for the Week Ending January 24
Let's take a look at companies that raised/lowered their dividend this week.