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Latest Valuentum Commentary
Dec 31, 2020
2020 Won’t Soon Be Forgotten
2020 won’t soon be forgotten. The tumultuous year brought with it the greatest shock to the U.S. economy in modern history, ushering in the largest-ever decline in U.S. real annualized gross domestic product of 31.4% in the second quarter of the year (surpassing the prior record of a 28.6% collapse in the second quarter of 1921). Strict lockdowns to help contain the outbreak of COVID-19 created the biggest global health emergency in a century, driving a self-inflicted economic collapse worse than the Great Recession, the Great Depression, and any other recession before it (the Depression of 1873-1879, the Panic of 1893, etc.). Millions were put out of work. During the month of April alone, the economy lost a record 20.8 million jobs, with some estimating that the “real” unemployment rate during the depths of the COVID-19 crisis reached nearly 23%. The official 14.7% unemployment rate in April would obliterate prior post-World War II era records, and while it fell short of the peak Great Depression unemployment rate estimated at 24.9%, the pain of many families and households was no less severe as they battled both a financial and health crisis that materialized in a matter of weeks, with little lead time to prepare for what was to come. Pantry stuffing and panic buying of consumer goods became a sign of the times, and a great debate about the efficacy of wearing masks raged across mediums.
Dec 21, 2020
Our Reports on Stocks in the Telecom Services Industry
Image Source: Mike Mozart. Our reports on stocks in the Telecom Services industry can be found in this article. Reports include CMCSA, LUMN, DISH, T, TMUS, VZ, SBAC, AMT, CCI, VIAC. The telecom industry is characterized by rapid technological change, intense competition and pricing pressures. The mature wireline segment remains under attack from cable/wireless products. Mobile technology enhancements such as the iPhone continue to attract new wireless subscribers in less saturated markets, but this has not lessened the intensity of competition. Industry constituents continue to pursue acquisitions in order to reduce bloated cost structures and achieve synergies. Average revenue per subscriber and churn rates should be monitored closely. We’re neutral on the structure of the group.
Nov 25, 2020
Thinking Slow: 3 Research Blind Spots That Changed the Investment World
Image Source: EpicTop10.com. We have to be on high alert about how our minds work. PBS is premiering a four-part series examining about how easily our minds are being hacked, and why it is so important to "think slow." Tune in (5). When it comes to the active versus passive debate, does the analysis suffer from parameter risk? With respect to empirical, evidence-based analysis, does the analysis have the entire construct wrong? When it comes to short-cut multiples, are we falling into the behavioral trap of thinking on autopilot?
Oct 27, 2020
Crown Castle Continues to Shine
Image Shown: Crown Castle International Corp.’s growth trajectory continued in the third quarter of 2020. Image Source: Crown Castle International Corp. – Third Quarter of 2020 IR Earnings Presentation. Crown Castle International Corp--3.3% yield (as of this writing)--is a real estate investment trust (‘REIT’) that owns 40,000+ cell towers, ~70,000 small cell nodes (on air or under contract) and ~80,000 route miles of fiber that support numerous networking operations all across the US. We include shares of Crown Castle as a holding in our High Yield Dividend Newsletter given its ability to generate sizable free cash flows even after investing heavily in expanding its asset base. From 2017 to 2019, Crown Castle generated ~$0.75 billion in annual free cash flows, though the firm had to tap capital markets to cover its annual common dividend obligations which averaged ~$1.75 billion during this period (its annual preferred dividend obligations averaged just under $0.1 billion during this period). While the REIT is capital market dependent, given the importance of its asset base which is primarily made up of essential infrastructure that supports telecommunications services in the US (including 5G services) and its ability to generate consistent free cash flows (rare in the REIT industry), we see Crown Castle maintaining access to both debt and equity markets at attractive rates going forward. When the REIT reported third quarter 2020 earnings on October 21, management had enough confidence in Crown Castle’s outlook to boost the firm’s quarterly dividend by 11% on a sequential basis. Though management has had to adjust Crown Castle’s 2020 guidance several times (including to the downside), largely due to headwinds created by the ongoing coronavirus (‘COVID-19’) pandemic, the REIT still expects to generate meaningful revenue and adjusted funds from operations (‘AFFO’) growth this year.
Oct 23, 2020
Dividend Increases/Decreases for the Week October 23
Let's take a look at companies that raised/lowered their dividend this week.
Sep 10, 2020
High Yield Dividend Income Investing in a Time of Need
Image: EpicTop10.com. The skills to successfully invest for long-term capital gains or long-term dividend growth are much different than those required for generating high yield dividend income. Income investing is a much different proposition. However, the skills do center on a similar equity evaluation process, but one that requires an acknowledgement and heightened awareness of considerably greater downside risks. Income investing, or high yield dividend income investing, should at times be considered among the riskiest forms of investing, as many high dividend-yielding securities tend to trade closer to the characteristics of junk-rated bonds than they do most net cash rich and free cash flow generating powerhouses that we like so much in the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio.
Sep 8, 2020
The Most Important Thing: You
Research publisher Valuentum will continue to offer members great ideas, fantastic commentary, and wonderful newsletters and reports, but Pigeon Oak's mission will be to offer clients peace of mind with advice tailored to their goals and risk tolerances. Pigeon Oak will also offer several strategies for financial advisors and institutions. Please stay tuned in the coming months for more information on how I can meet your financial needs at Pigeon Oak Capital Management, LLC.
Sep 3, 2020
3 Lessons in Portfolio Management Over 10 Years
Image Source: http://www.epictop10.com/. "When I left as director in the equity and credit department at Morningstar in 2011, I thought I knew a whole heck of a lot about investing. I felt like I was one in the top 5-10 in the world as it relates to the category of practical knowledge of enterprise valuation (maybe include Koller at McKinsey, Mauboussin at Counterpoint, and Damadoran at Stern on this list). After all, I oversaw the valuation infrastructure of a department that used the process extensively, and the firm was among just a few that used enterprise valuation systematically. Then, at Valuentum, our small team would go on to build/update 20,000+ more enterprise valuation models. There can always be someone else out there, of course, but I don't think anybody has worked within the DCF model as much as I have across so many different companies. That said, through the past near-10 years managing Valuentum's simulated newsletter portfolios, I've also learned a number of things to become an even better portfolio manager." -- Brian Nelson, CFA
Sep 3, 2020
Update: Frequently Asked Questions About Valuentum Securities, Inc.
Valuentum (val∙u∙n∙tum) [val-yoo-en-tuh-m] Securities Inc. is an independent investment research publisher, offering premium equity reports and dividend reports, as well as commentary across all sectors/companies, a Best Ideas Newsletter (spanning market caps, asset classes), a Dividend Growth Newsletter, modeling tools/products, and more. Independence and integrity remain our core, and we strive to be a champion of the investor. Valuentum is based in the Chicagoland area. Valuentum is not a money manager, broker, or financial advisor. Valuentum is a publisher of financial information. We address a number of questions from both subscribers and visitors to our site.
Aug 3, 2020
Video: Exclusive 2020 -- Furthering the Financial Discipline
In this 40+ minute video jam-packed with must-watch content, Valuentum's President Brian Nelson talks about the Theory of Universal Valuation and how his work is furthering the financial discipline. Learn the pitfalls of factor investing and modern portfolio theory and how the efficient markets hypothesis holds little substance in the wake of COVID-19. He'll talk about what companies Valuentum likes and why, and which areas he's avoiding. This and more in Valuentum's 2020 Exclusive conference call. Note: The August edition of the Exclusive publication will be released Saturday, August 8.
Latest Press Releases
The High Yield Dividend Newsletter, Best Ideas Newsletter, Dividend Growth Newsletter, Nelson Exclusive publication, and any reports, articles and content found on this website are for information purposes only and should not be considered a solicitation to buy or sell any security. The sources of the data used on this website are believed by Valuentum to be reliable, but the data’s accuracy, completeness or interpretation cannot be guaranteed. Valuentum is not responsible for any errors or omissions or for results obtained from the use of its newsletters, reports, commentary, or publications and accepts no liability for how readers may choose to utilize the content. Valuentum is not a money manager, is not a registered investment advisor and does not offer brokerage or investment banking services. Valuentum, its employees, and affiliates may have long, short or derivative positions in the stock or stocks mentioned on this site.