Chipotle Sees Bigger Unit Growth Opportunity in North America, Continued Pricing Power
February 10, 2022
Image: Chipotle’s shares look like they are poised to break out of a downtrend on news that its long-term unit restaurant opportunity is bigger than expected and that its pricing power remains intact. By Brian Nelson, CFA Chipotle Mexican Grill, Inc. (CMG) and Domino’s Pizza Inc. (DPZ) are two of our favorite restaurant ideas, with the former and Yum Brands’ (YUM) helping to drive restaurant stocks higher after the market’s reaction to their respective calendar fourth-quarter reports during the trading session February 9, 2022. Year-to-date, the AdvisorShares Restaurant ETF (EATZ) has held up better than most other investable areas, down modestly, and we think the relative strength is a big win for investors in the restaurant sector in light of
Best Idea Disney Rebounding Nicely; Shares Look Cheap
February 10, 2022
Image Shown: Shares of The Walt Disney Company strengthened February 9 in the wake of the media and entertainment giant’s latest earnings report. We include shares of DIS as an idea in the Best Ideas Newsletter portfolio. By Callum Turcan On February 9, The Walt Disney Company (DIS) reported first-quarter fiscal 2022 earnings (period ended January 1, 2022) that smashed past both consensus top- and bottom-line estimates. A sharp rebound at its ‘Disney Parks, Experiences and Products’ unit impressed investors and shares of DIS are strengthening nicely in the wake of its latest earnings report. We are big fans of Disney and include shares of DIS as an idea in the Best Ideas Newsletter portfolio. Our fair value estimate stands
Dividend Growth and ESG Favorite Republic Services Is Buying U.S. Ecology
February 10, 2022
Image Shown: Republic Services Inc is one of our favorite waste management companies. On February 9, the company announced it was acquiring US Ecology Inc through an all-cash deal. US Ecology provides specialized waste management services and has an asset base that is nearly irreplaceable. We like the deal as it could generate meaningful cost saving and revenue synergies. Image Source: Republic Services Inc – February 2022 Infographic By Callum Turcan On February 9, one of our favorite waste management companies, Republic Services Inc (RSG), announced a deal to acquire U.S. Ecology Inc (ECOL) through an all-cash deal worth about $2.2 billion when including net debt considerations. Republic Services is paying $48 per share in cash to take over U.S.
Sonos Expected to Continue Growing Rapidly; Margin Concerns Remain Key Issue
February 7, 2022
Image Source: Sonos Inc – Fourth Quarter of Fiscal 2021 IR Earnings Presentation Executive Summary: Sonos Inc’s financial performance staged an impressive turnaround in fiscal 2021. The company exited fiscal 2021 with a $640 million net cash position and generated $208 million in free cash flow that fiscal year. Sonos is leveraging its financial strength by buying back its stock. The firm is also considering potential M&A activities that could be used to enhance its growth runway, with an eye towards the potential for Sonos to expand into the premium wireless headphone space. Sonos forecasts that it will grow its revenues by double-digits annually in fiscal 2022, though its margins are expected to face moderate headwinds this fiscal year. Shares
Undervalued PINS, SNAP Rallying; FB Incredibly Mispriced, and Refreshed Consumer Discretionary Reports
February 4, 2022
Image: Valuentum’s Periodic Screener, February 4. — By Valuentum Analysts — Two of the most undervalued stocks in our coverage Pinterest, Inc. (PINS) and Snap Inc. (SNAP) are indicated to rally hard February 4 after issuing positive earnings reports, providing further evidence of the importance of the discounted cash flow process and the magnet that intrinsic value estimates are to stock prices. Pinterest is indicated up ~14%, while Snap is indicated up ~47% based on the latest information we have. — The refreshed Valuentum periodic data screener is now available for download on our website (it can be found in the ‘Stock Screens’ section in the left column of our website). The periodic data screener, which also includes updated fair value estimates on
Dividend Growth Idea Qualcomm Growing Robustly
February 3, 2022
Image Shown: Dividend growth idea Qualcomm Inc posted a solid earnings update and provided promising near term guidance on February 2. Image Source: Qualcomm Inc – First Quarter of Fiscal 2022 IR Earnings Presentation By Callum Turcan On February 2, dividend growth idea Qualcomm Inc (QCOM) reported first quarter earnings for fiscal 2022 (period ended December 26, 2021) that beat both consensus top- and bottom-line estimates. The semiconductor company issued guidance for the current fiscal quarter that calls for double-digit revenue and earnings growth versus fiscal year-ago levels, though shares of QCOM still dipped modestly in after-hours trading that day. We continue to like Qualcomm as an idea in the Dividend Growth Newsletter portfolio as the firm remains a free
PayPal’s Margin Pressure, Flattish Earnings Outlook Shocks Market; Fair Value Estimate Reduced
February 3, 2022
Image Shown: PayPal Holdings Inc grew at a robust pace in 2021 though its margin outlook is not as promising as once believed. Image Source: PayPal Holdings Inc – Fourth Quarter of 2021 earnings press release By Callum Turcan On February 1, PayPal Holdings Inc (PYPL) reported fourth quarter 2021 earnings that beat consensus top-line estimates but missed consensus bottom-line estimates. While PayPal put out guidance that called for its revenues to grow by mid-to-upper teens in 2022, the market was unimpressed with its non-GAAP earnings outlook that called for marginal growth at the midpoint. It now stands to reason that PayPal’s operating/earnings leverage potential is not what it first appeared to be, particularly in light of the meager earnings
