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Recent Articles
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ICYMI: The Impact Rising Interest Rates Have on Equity REITs
Jun 1, 2023
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Image: REITs have not performed as well as one might have thought. The Vanguard REIT ETF has underperformed the broader market considerably since 2015, while dividends per share have not grown much, if at all, since 2005. Source: Vanguard.
The question on most everyone's minds: How will equity real estate investment trusts (REITs) fare in the current rising interest-rate environment? The topic has long been debated and studied, and there are myriad opinions on the subject. From where we stand, however, there are a two main moving parts consisting of fundamental and investment dynamics that investors should be aware of. Let's have a look.
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Phillips 66’s Stock May Be Volatile But Its Management Remains Very Shareholder Friendly
May 30, 2023
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Image: Phillips 66’s shares have been quite volatile as refining margins ebb and flow, but shares are up nicely since the start of 2021 even as they’ve given up some ground so far in 2023.
Phillips 66’s dividend yield stands at 4.4% at the time of its writing, and management remains committed to continuing to raise the payout, having done so as recently as its most recently reported quarter. Refining margins will continue to be volatile as feedstock costs fluctuate and prices at the pump vary, and while Phillips 66 retains a rather large total debt load, we think the risks are acceptable for this income generator. We continue to like shares as an idea in a well-diversified equity income portfolio.
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Dividend Increases/Decreases for the Week of May 26
May 26, 2023
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Let's take a look at firms raising/lowering their dividends this week.
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Nvidia Rockets Higher to Propel Large Cap Growth
May 25, 2023
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Image: Nvidia powers higher after releasing better-than-expected second-quarter fiscal 2024 guidance. The company continues to be a driver behind the outperformance of large cap growth as a stylistic area.
We haven’t seen a quarterly guidance beat like this since Synaptics put up a monster quarter when Apple started using its innovative click-wheel technology in the first-generation iPod, almost 20 years ago. Nvidia Corp.'s outlook for the second quarter of its fiscal 2024 was phenomenal thanks to tremendous interest in its chips that power artificial intelligence [AI]. We expect a material increase in our fair value estimate of Nvidia, but shares remain quite pricey, in our view. Revenue during Nvidia’s fiscal second quarter is expected to be ~$11 billion versus consensus that had been looking at ~$7 billion, implying a forward outlook more than 50% better than what the Street was looking for. Interestingly, Synaptics’ click-wheel technology started the wave of Apple products, which have been the go-to tech platform for years, and Nvidia may very well be the driving force behind AI proliferation, the next great technology platform.
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