Fundamental data is updated weekly, as of the prior weekend. Please download the Full Report and Dividend Report for any changes.
Latest Valuentum Commentary
Sep 2, 2020
ALERT: Markets Now Fairly Valued
Image Source: Sam Valadi. Long-term investing is a great proposition. You have an incredible advantage over most professional investors that have to deliver on a quarterly or annual basis. The reason is due to something called time horizon arbitrage.
Jul 30, 2020
McDonald’s Improving But Serious Hurdles Remain
Image Shown: Shares of McDonald’s Corporation are richly valued as of this writing, especially when considering the headwinds facing its business in the near-term and its hefty net debt load. On July 28, McDonald’s Corp reported second quarter 2020 earnings that beat consensus top-line estimates but fell short of consensus bottom-line estimates. As expected, the ongoing coronavirus (‘COVID-19’) pandemic took a large bite out of its performance last quarter with global comparable sales down 23.9% versus the same period a year-ago. McDonald’s reported that its global comparable store sales trajectory improved throughout the second quarter as the decline shrank from -39.0% (negative 39.0%) in April 2020 to -12.3% (negative 12.3%) by June 2020. Shares of MCD sold off modestly during normal trading hours on July 28, and we caution that McDonald’s still appears to be generously valued as of this writing.
May 8, 2020
ICYMI: Never Been More Bullish Even as Buffett Dumps Airlines
Image Source: IATA. Data Source: McKinsey & Company (IATA). Airlines haven’t been able to earn their estimated cost of capital for as long as we can remember. There have been hundreds of airline bankruptcies since deregulation in 1978. The news may be scary in coming months, and market volatility may elevate again, but we’ve never been more bullish on the longer run. The biggest advantage of an individual investor is something called time horizon arbitrage. As many professionals continue to fear a break below the March 23 lows, we’re focused on how this market absorbs the tremendous and unprecedented stimulus in the coming months and what that means for nominal equity prices in the longer run. It may not happen this month or this year, but we expect lift off as investors race to preserve purchasing power! Our favorite ideas for a portfolio setting remain in the Best Ideas Newsletter portfolio, Dividend Growth Newsletter portfolio, and High Yield Dividend Newsletter portfolio. Our favorite brand new ideas, released each month, are included in the Exclusive publication.
Mar 23, 2020
US Fiscal Stimulus Update
Image Source: frankieleon. The US Congress is debating and working on a massive multi-trillion dollar fiscal stimulus package to mitigate the negative impact the ongoing novel coronavirus (‘COVID-19’) pandemic is having on the domestic economy and to provide for additional healthcare funds to cash-strapped entities to combat the virus.
Mar 23, 2020
Fed and Treasury Efforts Might Not Be Enough to Avoid Another Great Depression
Image: The Energy Select Sector SPDR and Financial Select Sector SPDR, two securities removed from both the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio in August 2019 have been ravaged during this market selloff. We maintain our view that the energy and banking sectors are worth avoiding during this market meltdown. The U.S. is stuck between a rock and a hard place, and we might get the next Great Depression regardless of what the Fed or Treasury does. The timeline for when these markets attempt to bounce back meaningfully from this disruption may not be based on whether COVID-19 cases roll over, but rather when consumers start coming out to spend in droves again, and that may not happen until we have a vaccine broadly available. We're maintaining our fair value range on the S&P 500 of 2,350-2,750, with expectations of panic/forced selling down to 2,000 on the broad market index (it closed at 2,304.92 on Friday, March 20). We believe that savvy investors have been nibbling at this market during the past couple weeks and may have achieved up to 50%-75% of their equity allocation in a well-diversified portfolio via dollar-cost averaging strategies, with expectations of further market declines. Our best ideas remain in the Best Ideas Newsletter portfolio, Dividend Growth Newsletter portfolio, High Yield Dividend Newsletter portfolio and Exclusive publication. Expect more gut-wrenching volatility.
Mar 21, 2020
Repub from March 5, 2018: The Tragedy of Quantitative Finance
-- Okay – it’s not 2038, but just imagine if this could happen…
Mar 20, 2020
Dividend Increases/Decreases for the Week Ending March 20
Let's take a look at companies that raised/lowered their dividend this week.
Mar 19, 2020
Extreme Volatility and Crisis Economics
Image: The Dow Jones has now registered 8 consecutive trading days with a 4% move in either direction, from March 9 through March 18. This is the most volatile time in history, a streak that is longer than the 5 consecutive days registered in November 1929 (Great Depression), 4 consecutive days in 1987 (Crash of 1987), and 4 consecutive days in 2008 (Great Financial Crisis). The worst of the declines may still be ahead of us. The S&P 500 still is trading within our fair value estimate range of 2,350-2,750, and we wouldn’t be surprised to see panic/forced selling all the way down to 2,000 on the S&P. Expect more volatility, and please stay safe out there as the world declares all out war on COVID-19. Our best ideas remain in the Best Ideas Newsletter portfolio, Dividend Growth Newsletter portfolio, High Yield Dividend Newsletter portfolio, and Exclusive publication.
Mar 17, 2020
Buybacks and Wealth Destruction
From Value Trap: "According to S&P Dow Jones Indices, S&P 500 stock buybacks alone totaled $519.4 billion in 2017, $536.4 billion in 2016, and $572.2 billion in 2015. In 2018, announced buybacks hit $1.1 trillion. Given all the global wealth that has been accumulated through the 21st century, it may seem hard to believe that another Great Depression is even possible. However, in the event of a structural shock to the marketplace where aggregate enterprise values for companies are fundamentally reset lower, the vast amount of cash spent on buybacks would only make matters worse. The money that had been spent on buybacks could have been distributed to shareholders in the form of a dividend or even held on the books as a sanctuary of value within the enterprise during hardship. Buybacks, unlike dividends, can result in wealth destruction in a market economy, much like they can with companies. This is an important downside scenario that is often overlooked." -- Value Trap, published 2018
Mar 12, 2020
Caterpillar Reports Cratering Demand for its Products Amid COVID-19
Image Shown: Caterpillar Inc is hoping that efficiency improvements at its construction equipment business will help revive retail sales growth at the segment. That’s no easy task given the exogenous headwinds facing the company. Image Source: Caterpillar Inc – CONEXPO March 2020 IR Presentation. The ongoing novel coronavirus (‘COVID-19’) pandemic is beginning to wreak havoc on the global economy. Major agriculture, construction, energy, resource extraction and transportation equipment supplier Caterpillar Inc filed an 8-K report with the SEC on March 12 that highlighted just how rough the start of 2020 has been for the industrial space at-large. Even before the COVID-19 pandemic started spreading, Caterpillar’s retail sales had been coming under fire from slowing global economic growth, but now that decline has started to really pick up pace.
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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.