Valuentum Exclusive Analysis for the Discerning Investor

Symbol Keyword

Sep 30, 2022

Nike’s Fundamental Backdrop Speaks of Serious Impending Global Recession
Image Source: Raul Gonzalez. Nike’s share price has been roughly cut in half this year, and its fundamental backdrop speaks of a serious impending global recession, in our view. Weak revenue performance, lower gross margins, bloated inventory, and significant troubles in China suggest even tougher times are ahead. Nike is a not included in any of the simulated newsletter portfolios, and we’d be cautious on it as well as the broader retailing industry as the U.S. enters what could be a deep recession in 2023. Things are going to get worse before they get better.

Sep 28, 2022

Things Are Bad Out There
The Bank of England’s intervention to stem what might have turned into a “run on the bank” dynamic for pension funds in the country amid a collapsing pound has given rise to the view that the Fed may start to slow its rate of increases amid global uncertainty. We think it’s too early to tell. From our perspective, the Fed remains committed to stomping out inflation, something that it may not truly be able to do, given that interest rate hikes may be too blunt of an instrument to stymie food cost inflation, which remains one of the the biggest inflationary headwinds that is hurting consumer budgets. What is happening on the global stage is quite concerning, and we remain bearish on the equity markets. The bull case may very well be a deep recession in the U.S., where dollar cost averaging in the U.S. markets could be had, followed by sharp interest rate cuts by the Fed, and a return to all-time highs. This is not a time to lose interest, but a time to pay even closer attention to your investments. What you do over the next couple years will have implications on your portfolio 5, 10, and 20 years forward. Let’s keep focused on preserving and building long-term wealth!

Sep 21, 2022

Fed Raises 75 Basis Points; Food Price Inflation Continues to Wreak Havoc on Consumer Budgets
Image Source: Federal Reserve. The Fed upped its key benchmark rate to the range of 3%-3.25% on September 21, but it may not be enough to stem the rise in inflation. We think the market has further room to fall.

Sep 20, 2022

Dividend Growth Giant Microsoft Raises Its Dividend 10%!
Image Shown: Microsoft has been a fantastic dividend grower the past several years. The company announced September 20 another 10% increase in its quarterly dividend per share, to $0.68. Image Source: Microsoft. On September 20, dividend growth giant Microsoft Corp declared a quarterly dividend of $0.68 per share, a 10% increase from the prior rate, revealing a forward estimated yield of ~1.1% at the time of this writing. Microsoft has been the quintessential dividend growth stock, and the company remains an idea in the simulated Dividend Growth Newsletter portfolio, which has held up quite well during 2022 thus far.

Sep 20, 2022

Should You Gear Up for the Porsche AG IPO?
Image Shown: Unit sales at Porsche fell 5% during the first half of 2022, but demand remains particularly strong for its SUV models despite a troubled supply chain and higher input cost inflation. Image Source: Porsche AG. German luxury and sports car maker Porsche AG is planning to go public in the coming weeks, following in the footsteps of Ferrari, which listed a few years ago. Porsche-owner Volkswagen AG has been investing heavily in electric vehicles, and the IPO of the Porsche brand will provide it with fresh capital to be more competitive on that front.

Sep 19, 2022

The Success Equation Book Review: Is the Skill Paradox a Myth in Investing? We Think So
Image: The game of baseball has changed during the past 100 years. While many point to a declining standard deviation and coefficient of variation in batting averages for evidence of a paradox of skill in baseball, it's more likely the game has changed. Players are hitting more homeruns, sacrificing batting average as a result. Note the red part of the line is when the game of baseball expanded to the current number of 30 teams. Data from the COVID-19 shortened 2020 season omitted. Source: Baseball Almanac. There's a lot of informational value in reading The Success Equation (and everyone should pick up a copy), but please be careful to come to your own conclusion. From where we stand, there is not a paradox of skill in investing (or baseball, for that matter). The games have simply changed based on new incentives. Some wise person may have written this before: Be careful not in what you read, but rather in the conclusions you draw from your reading. We wish Mauboussin could re-write The Success Equation considering some of the thoughts in this article. Maybe he will!

Sep 13, 2022

Nelson Nailed Food Price Inflation Risks; Markets Heading Lower
Image Source: Liz West. The August CPI report, released September 13, showed that consumer prices advanced 8.3% on a year-over-year basis and are still accelerating, increasing 0.1 percent from July, where the pace was unchanged. Milk was up 17%, poultry up 15.9%, while eggs were up 39.8% in the August CPI report. We don’t think the market was expecting this sizable food price increase, but we were – a view that accounted for one of the reasons for our move to a more bearish stance last month.

Sep 8, 2022

LINK --> Massive Unrest In Europe, Energy Crisis Could Be the Catalyst to Topple the Global Markets
Europe is on the brink Over 70000 people came out in support of Russia in Prague and are forcing the Govt to resign for supporting Ukraine pic.twitter.com/lwMAjkBM2U — Mahesh 🇮🇳 (@Mahesh10816) September 3, 2022 The European energy crisis continues to unfold, and we’ve been keeping our members updated on this huge story. In the wake of the Russian invasion of Ukraine in February 2022, the European Union (‘EU’) along with key Western allies (such as the US, UK, Canada, Japan, South Korea, and Australia) imposed punishing economic sanctions on Russia to hinder its efforts in Ukraine and deter other nations from pursuing imperialistic land grabs. Russia retaliated by limiting the flow of various energy products to nations that imposed those sanctions. In particularly, energy flows from Russia to member nations within the EU were curtailed aggressively, with an eye towards France, Italy, and Germany along with Poland and the Baltic states (Latvia, Lithuania, and Estonia). Natural gas, crude oil, and petroleum product exports from Russia to EU member nations have tanked this year. The land war in Ukraine has not grown into a massive economic war in Europe, and this catalyst could be the one that topples the global markets.

Sep 7, 2022

Post-Mortem on Facebook (Meta Platforms): Apple Crushed Our Thesis
Image: Thesis creep kept us excited about Meta, but we've since trimmed the "weighting" in the simulated Best Ideas Newsletter portfolio. We still like Meta near these technical support levels, but only as a smaller "weighting" in the simulated Best Ideas Newsletter portfolio, as updated August 19. What more can we say--Apple is eating Facebook’s lunch, and the iPhone giant is now advancing with its advertising revenue, too. Apple blew up our thesis on Meta, and that's the long and short of it.

Sep 5, 2022

Valuentum: Now Bearish, We’ve Been Here Every Step of the Way
It’s easy to lose sight of the tremendous value that a Valuentum subscription provides during down markets, but we’ve been here for you every step of the way. 2019, 2020, and 2021 were fantastic years, and the simulated Best Ideas Newsletter portfolio and simulated Dividend Growth Newsletter portfolio have delivered in 2022. The High Yield Dividend Newsletter portfolio is holding up nicely, and ideas within the Exclusive publication continue to boast impressive success rates. Members continue to receive options ideas to bet directionally on the stock market, and the book Value Trap has been true to its efforts, showcasing the ongoing benefits of forward-looking analysis. [Given the change in opinion following the publishing of the August edition of the Best Ideas Newsletter, please be sure to check www.Valuentum.com for Valuentum’s latest.]