Valuentum Exclusive Analysis for the Discerning Investor

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Aug 27, 2022

Cisco Systems Expects Its Growth Trajectory Will Resume in Earnest This Fiscal Year
Image Shown: Cisco Systems Inc is incredibly shareholder friendly. Image Source: Cisco Systems Inc – Fourth Quarter of Fiscal 2022 IR Earnings Presentation. Cisco Systems reported fourth quarter earnings for fiscal 2022 (period ended July 30, 2022) that beat both consensus top- and bottom-line estimates. The networking hardware and software provider also issued promising guidance for fiscal 2023 that Wall Street appreciated. Cisco Systems is steadily putting supply chain hurdles (with an eye towards a shortage of semiconductor components and transportation bottlenecks) behind it and its growth outlook is starting to improve as a result. We continue to like shares of CSCO as an idea in both the Best Ideas Newsletter and Dividend Growth Newsletter portfolios. Shares of CSCO yield ~3.2% as of this writing.

Aug 25, 2022

Dividend Growth Idea Dick’s Sporting Goods Beats Estimates, Raises Guidance
Image Shown: Shares of Dick’s Sporting Goods Inc have been on a nice upward climb of late. The sporting goods retailer raised its full-year guidance for fiscal 2022 during its fiscal second quarter earnings report. On August 23, Dick’s Sporting Goods Inc reported second quarter earnings for fiscal 2022 (period ended July 30, 2022) that beat both consensus top- and bottom-line estimates. The sporting goods retailer also raised its full-year guidance for fiscal 2022 in conjunction with the report, after previously lowering its guidance during its fiscal first quarter earnings update in May 2022. We continue to like Dick’s Sporting Goods as an idea in the Dividend Growth Newsletter portfolio. Shares of DKS yield ~1.8% as of this writing when looking at its regular quarterly payout. The company has also paid out special dividends in the recent past, including a $5.50 per share special dividend in fiscal 2021 along with a $2.00 per share special dividend back in fiscal 2012.

Aug 25, 2022

Dividend Growth Idea Qualcomm Growing at a Robust Clip
Image Shown: Dividend growth idea Qualcomm Inc put up strong performance last fiscal quarter. Image Source: Qualcomm Inc – Third Quarter of Fiscal 2022 Earnings Press Release. Qualcomm recently reported third quarter earnings for fiscal 2022 (period ended June 26, 2022) that beat both consensus top- and bottom-line estimates. The company provided guidance for the fiscal fourth quarter that was a tad lighter than what Wall Street was looking for, though its near term forecasts still call for substantial revenue and earnings growth on a year-over-year basis. We like Qualcomm as an idea in the Dividend Growth Newsletter portfolio given its stellar free cash flow generating abilities, healthy balance sheet, pricing power, bright growth outlook, and margin expansion potential. Shares of QCOM yield ~2.2% as of this writing.

Aug 24, 2022

ICYMI (Aug 19) -- ALERT -- PYPL, META, GOOG, V -- Making Some Big Changes in the Simulated Best Ideas Newsletter Portfolio!
Image Shown: We are very happy with the overall "performance" of the simulated Best Ideas Newsletter portfolio, which is carving out 2.6 percentage points of relative outperformance so far in 2022 on a price-only basis, as shown in the table above. However, we're making some big changes to the simulated newsletter portfolio today on some of our favorite names. Our best ideas continue to be in the simulated Best Ideas Newsletter portfolio, the simulated Dividend Growth Newsletter portfolio, the simulated High Yield Dividend Newsletter portfolio, the simulated ESG Newsletter portfolio, and the Exclusive publication, as well as with our additional options commentary. We're making some big moves in the simulated Best Ideas Newsletter portfolio today! At the moment, the simulated Best Ideas Newsletter portfolio is carving out about 2.6 percentage points of relative outperformance so far in 2022, on a price-only basis relative to the the SPDR S&P 500 Trust ETF. Overall, after some huge years, the simulated Best Ideas Newsletter portfolio is down a modest ~8.6% in 2022, by our estimates. Pretty good, all things considered. That said, the SPDR S&P 500 Trust ETF has bounced right off its 200-day moving average (technical resistance), and we're not going to sit by while the risks to the market this year increase. We remain bullish on stocks for the long haul, of course, but we think incremental alpha may be generated by removing/trimming/adding to some of our winners in the simulated Best Ideas Newsletter portfolio at this time. We're changing our mind on a couple things, too, as any good investor does. [This note was emailed to members August 19.]

Aug 19, 2022

Nelson: The 16 Most Important Steps To Understand The Stock Market
Image Source: Tim Green. We outline the '16 Most Important Steps to Understand the Stock Market.' We think it's important to take a read of these key stock market tenets when things are going great -- and perhaps even more important when things aren't going your way. This continues to be a working document.

Aug 19, 2022

Public Storage Is One of Our Income Generation Favorite Ideas
Image Shown: Shares of Public Storage, one of our favorite income generation ideas, have boomed higher over the past five years with room for additional upside. Public Storage reported second quarter 2022 earnings that missed consensus top-line estimates but beat consensus bottom-line estimates as the self-storge industry in the US continues to benefit from robust demand. Surging home prices have made many households turn to self-storage options as an economical way to maximize their living space. During its second quarter earnings update, Public Storage also moderately raised its full-year guidance for 2022 which we appreciate. We are huge fans of Public Storage as the real estate investment trust (‘REIT’) is able to generate sizable “excess” free cash flows after fully covering its total payout obligations, something most REITs outside of the self-storage industry are unable to do given their hefty capital expenditure obligations. Public Storage is included as an idea in the High Yield Dividend Newsletter portfolio.

Aug 19, 2022

Dividend Growth Idea Home Depot Beats Estimates, Maintains Guidance
Image Shown: Dividend growth idea Home Depot is a stellar free cash flow generator in almost any operating environment. Historically, the home improvement retailer’s free cash flows have fully covered its dividend obligations, and we forecast that will continue to be the case going forward. However, we caution that its sizable share repurchases are being funded in part by its balance sheet. The firm has a large net debt load on the books. Image Source: Home Depot Inc – Second Quarter of Fiscal 2022 IR Earnings Presentation. On August 16, Home Depot reported second-quarter earnings for fiscal 2022 (period ended July 31, 2022) that beat both consensus top- and bottom-line estimates. The home improvement retailer also reaffirmed its guidance for fiscal 2022 in conjunction with its latest earnings update. We like Home Depot as an idea in the Dividend Growth Newsletter portfolio. Shares of HD yield ~2.4% as of this writing, and our fair value estimate sits at $345 per share of Home Depot, well above where the company’s shares are trading at as of this writing. Home Depot’s free cash flow generating abilities and pricing power are impressive, and its growth runway remains largely intact, even in the face of sizable exogenous shocks.

Aug 17, 2022

Disney’s Theme Parks and Resorts Benefiting from Pent-Up Demand
Image Shown: The Walt Disney Company posted a rock-solid earnings report for the period ended July 3 as its business benefited from pent up demand for its theme parks and resorts offerings. Image Source: The Walt Disney Company – Third Quarter of Fiscal 2022 Earnings Press Release. On August 10, The Walt Disney Company reported third quarter earnings for fiscal 2022 (period ended July 3, 2022) that beat both consensus top- and bottom-line expectations. Its theme parks and reports business came roaring back from the worst of the COVID-19 pandemic while its video streaming services continued to add millions of paid subscribers to their customer bases. Shares of DIS have surged higher in recent weeks, and we continue to like Disney as an idea in the Best Ideas Newsletter portfolio. Our fair value estimate sits at $156 per share of Disney, well above where shares are trading at as of this writing indicating the company has ample capital appreciation upside potential.

Aug 14, 2022

Stocks Surge: Strong S&P 500 Earnings Growth Expected, Headline Scares With Inflation Tamed, Interest Rates Still Low
Image Source: BLS. The pace of inflation looks like it may slow down considerably in 2023 as sequential monthly increases pause their advance. Everybody seems to be looking to compare this market to another market sometime in the past, but regardless of which analog you read about, there is one thing that every pullback, crises, or calamity has had in common: The markets eventually returned to all-time highs. That’s what we’re betting on. Some say we could see new highs by the end of the year, but for us, we’re okay if it takes some time longer than that. The past few years have simply been awesome for equity returns, to say the least! Regardless, those higher nominal input prices that everyone is talking about today will eventually act as a launchpad for nominal earnings and nominal equity prices in the future, pushing them ever higher, in our view. What more can we say, we continue to like stocks for the long haul!

Aug 11, 2022

Albemarle Raises Guidance Yet Again, Expects to Be FCF Positive in 2022
Image Shown: Albemarle Corporation’s lithium operations have posted stellar financial performance in recent quarters and underpin the firm’s bright long-term growth outlook. Image Source: Albemarle Corporation – Second Quarter of 2022 IR Earnings Presentation. We liked what we saw in Albemarle’s latest earnings report. Albemarle is betting the farm that the supply-demand dynamics will remain favorable for lithium producers. Volume growth and favorable pricing for lithium derivatives is a powerful combination that Albemarle has effectively capitalized on so far. Lithium is a major component in lithium-ion batteries which are used to power electric vehicles (‘EVs’), battery storage facilities, consumer electronics, and much more. Should EV sales continue to grow while utilities are increasingly turning to battery storage solutions to supplement their backup power options, demand for lithium should continue to grow at a robust pace as well. Albemarle is well-positioned to capitalize on this upside, aided by its stellar operational execution. Shares of ALB yield ~0.7% as of this writing and the top end of our fair value estimate range for Albemarle sits at $309 per share.