Fundamental data is updated weekly, as of the prior weekend. Please download the Full Report and Dividend Report for any changes.
Latest Valuentum Commentary
Oct 1, 2021
Best Idea Visa on the Rebound, Generating Gobs of Free Cash Flow
Image Shown: Visa Inc is a stellar free cash flow generator and is included as an idea in our Best Ideas Newsletter portfolio. Image Source: Visa Inc – Third Quarter of Fiscal 2021 IR Earnings Presentation. We are huge fans of the payment processing and payment solutions space. This industry is supported by secular growth tailwinds due to the global shift away from cash-to-card and card-not-present (e.g. online purchases) purchase options, and the ongoing proliferation of e-commerce. Furthermore, companies in this space benefit immensely from the network effect, which creates an economic moat for their business. These companies are incredibly lucrative with relatively high operating margins and impressive free cash flow generating abilities, aided by their relatively modest capital expenditure requirements to maintain a certain level of revenues. We include payment networks giant Visa as a “top-weighted” idea in the Best Ideas Newsletter portfolio and view its capital appreciation upside quite favorably, with the top end of our fair value estimate range sitting at $304 per share of Visa.
Sep 13, 2021
The Investment Case for More Gender Diversity
Image: The Impact Shares' YWCA Women’s Empowerment ETF (WOMN) has trounced the S&P 500 since inception, while the SPDR SSGA Gender Diversity Index ETF (SHE) has bested the quantitatively-hailed small cap value ETF over the same time period. There has been a plethora of research over the years regarding the value of diversity on teams, in corporate boardrooms, and across asset management. One of the forms of diversity is gender diversity. It has been documented that diverse teams create more innovative ideas and creativity, which can serve as quite an advantage in industries where margins are slim, or there are few barriers to entry. While a 2019 study summarized in the Harvard Business Review indicated that the value of gender diversity is highly context-dependent and tends to have the greatest benefit where it is already valued, the corporate environment, and arguably the stock market, itself, are a few of those areas where value has been demonstrated.
Sep 3, 2021
Best Idea PayPal Is a Tremendous Enterprise with Ample Capital Appreciation Upside
Image Source: PayPal Holdings Inc – 2021 Investor Day Presentation. PayPal is a stellar enterprise with rock-solid financials. The company is incredibly free cash flow positive and carries a pristine balance sheet while also sporting tremendous pricing power. We continue to be enormous fans of the fintech giant and expect to hear more great things from the company going forward. PayPal’s growth outlook is incredibly bright, and we forecast the company’s free cash flows will swell higher over the years and decades to come. Management noted during the firm’s 2021 Investor Day event that the goal is to allocate 30%-40% of PayPal’s future free cash flows towards share repurchases over the medium-term. We view PayPal’s capital appreciation upside quite favorably and continue to like the company as an idea in the Best Ideas Newsletter portfolio with a sizable 'weighting' in the portfolio.
Jul 26, 2021
Chinese Stocks Getting Hammered
Image shown: A confluence of factors are driving Chinese stocks lower, not the least of which is heightened regulatory concerns.Investing is really simple. You don’t need to find terribly underfollowed ideas to do well, just mispriced ones. For example, Alphabet is up over 80% the past 52 weeks, and the company has been a top weighting in the Best Ideas Newsletter portfolio for some time. Facebook has also been an outperformer. There’s no need to make things complicated. Focus on undervalued stocks on a DCF basis that have strong market support through relative strength or a solid technical breakout--and stay away from those net-debt heavy, low valuation multiple value traps!
Jul 24, 2021
Best Ideas Newsletter Portfolio Soars!
Image shown: The top weighted ideas in the Best Ideas Newsletter portfolio continued to lead the charge during the trading session Friday, July 23. Facebook and Alphabet rallied on favorable reports from social media peers, while Vertex continues to recover thanks in part to encouraging views on CRISPR technology, while Visa looks to be back on track. DPZ had a strong trading session July 22 and experienced some profit taking. Image source: Seeking Alpha. The digital economy is here to stay, and online advertising is not a luxury but rather a necessity. Though many aren’t too big of fans of Facebook, the company, its stock continues to be severely underpriced, as its Shops and Dating features remain under-monetized, while potential at other properties such as Messenger and WhatsApp remain in the early innings, in our view. Our valuation of Facebook doesn’t include the tremendous promise that it holds in other areas of nascent growth and largely only considers Facebook/Instagram, meaning there is further upside potential beyond our fair value estimate range. Alphabet is benefiting from a lot of similar trends.
Jul 15, 2021
Answering Some Questions from Our Members
Image Source: Eric. Let’s cover some recently asked questions for the benefit of all.
Jul 14, 2021
10 YEARS OF EXCELLENCE AT VALUENTUM
Join Valuentum as it celebrates its 10th anniversary of putting investors first!
Jul 8, 2021
Still Bullish -- Stocks for the Long Run!
Image shown: The 10-year Treasury rate has fallen quite a bit since March of this year, suggesting that inflation expectations have come down in recent months. Image source: CNBC. The S&P 500, Dow Jones Industrial Average and Nasdaq continue to hover near all-time highs, and all appears well. We maintain our bullish take on the markets and believe that we are in the early innings of a long bull market that started following the washout March 2020 during the depths of the COVID-19 meltdown. Stock bull markets tend to average about 4.4 years in duration, with the last one enduring ~11 years, while bear markets are very abrupt, lasting only 11.3 months on average, the last one a very short 1.1 months, according to data from First Trust. We’re about 15 months into this new stock bull market, and we continue to believe increased equity exposure may better serve investors of all types going forward, through both the best of times and the worst of times.
Jun 29, 2021
The Skill Paradox Is a Myth in Investing
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. Source: Baseball Almanac. Michael Mauboussin, while highlighting in his own words in The Success Equation how stock portfolios have conformed over time due to a reduction of active share brought about by myriad influences in how active managers are "playing the game," completely misses using this explanation as the correct conclusion for the observation of declining standard deviations of excess returns. There is no paradox of skill in investing. Investors are conforming to the same playbook due to conflicting incentives (perhaps even driving active management skill levels collectively lower), and this is resulting in what we're seeing today. Unlike his work in evaluating baseball and basketball, Mauboussin seems to completely miss that active mutual funds and ETFs are also only 15% of the market. In the case of investing, analyzing the standard deviation of returns of 15% of the stock market, as in active funds and ETFs, tells us little about luck or skill. Warning about the use of small sample sizes early in the book, the combination of this errant conclusion has only padded the indexing propaganda making The Success Equation an absolute tragedy of a text, and I must say it hurts me a lot to say it (I know how much work goes into writing a book, and I generally enjoy Mauboussin's work).
Jun 27, 2021
Two Alerts and Bull Market On!
Image Source: Mike Cohen. "We like stocks in an inflationary environment, and we love big cap tech and large cap growth in any environment." -- Brian Nelson, CFA
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.