Our Report on Stocks in the Utilities (Large) Industry
February 28, 2022
Image Source: doggo Structure of the Utilities Industry Utilities provide an essential service, generally operate in a near-monopoly position, and benefit from significant barriers to entry due to the capital intensity of new projects and regulatory/environmental requirements. Regulatory frameworks differ across the grid, but most utilities benefit from an assured rate of return on capital investments through predetermined rate structures, where cost adjustments are made by authorities periodically. Most constituents benefit from stable operations and generally lower debt financing, though credit ratings should be monitored closely. We like the structure of the group. Please select here (pdf) to download the report on utilities in our coverage. —– Valuentum members have access to our 16-page stock reports, Valuentum Buying Index ratings,
Valuentum Weekly: Putin, the Aggressor, But Did the West” Cause the Conflict in Ukraine?”
February 27, 2022
For, in the final analysis, our most basic common link is that we all inhabit this small planet. We all breathe the same air. We all cherish our children’s future. And we are all mortal.” — JFK, 1963 Transcript: Thank you for joining us today. It was April 1961, and the U.S. had covertly financed an invasion of Castro’s Cuba to overthrow the government there, a government that had become more opposed to the United States and more friendly with the Soviet Union. The invasion that came to be known as the Bay of Pigs invasion would go on to fail, but it would become part of the saga that ultimately led to the Cuban Missile Crisis the following year
Update: Analyzing Valuentum’s Economic Castle Index: A Walk Forward Case Study
February 25, 2022
This article was originally published February 20, 2020. By Callum Turcan and Brian Nelson, CFA In , the Valuentum team published a paper called The Castle Trumps the Moat which sought to change the conversation around Warren Buffett’s very popular phrase “economic moat” towards one with a more quantitative grounding. The idea behind an economic moat is that companies with such a qualitative attribute should generate stronger returns than those that don’t, at least so the thinking goes, given the ability for these firms to generate competitive advantages for themselves in their respective fields (allowing for these firms to charge relatively higher prices and/or incur lower expenses, resulting in larger profit streams than “non-moaty” companies). There are two things generally
High-Yielding American Tower Is a Free Cash Flow Cow
February 23, 2022
Image Shown: American Tower Corporation operates the tower structure and related land parcel of cell tower assets, while its tenants handle the remainder. Image Source: American Tower Corporation – Third Quarter of 2021 IR Earnings Presentation By Callum Turcan Rising geopolitical tensions, inflationary headwinds, supply chain hurdles, and pressures from the rising interest rate environment are all weighing negatively on equity markets. Through the end of normal trading hours on February 19, the S&P 500 (SPY) is down over 9% and the Vanguard Real Estate Index Fund ETF (VNQ) is down over 11% year-to-date on a price only basis. In our view, this selloff presents an opportunity for investors with a longer term focus to consider high-quality REITs such as
High-Yielding Life Storage Has Tremendous Dividend Strength
February 23, 2022
Image Shown: Life Storage Inc is committed to rewarding income seeking investors. Image Source: Life Storage Inc – January 2022 IR Presentation By Callum Turcan We recently added Life Storage Inc (LSI), a self-administered and self-managed real estate investment trust (‘REIT’) focused on self-storage properties in the US, as an idea to the simulated High Yield Dividend Newsletter portfolio (more here). Life Storage owns 1,000+ self-storage properties across 30+ states and has received an investment grade credit rating (Baa2/BBB) from two of the ‘Big Three’ rating agencies. The REIT also operates a third-party management platform for self-storage properties. Back in 2016, Life Storage rebranded from Sovran Self Storage and changed its ticker to LSI from SSS. Impressive Dividend Strength The
Cisco Posts Great Earnings Update; Increases Dividend and Share Buyback Authority
February 17, 2022
Image Shown: Cisco Systems Inc is a very shareholder friendly company. Image Source: Cisco Systems Inc – Second Quarter of Fiscal 2022 IR Earnings Presentation By Callum Turcan On February 16, Cisco Systems Inc (CSCO) reported second quarter earnings for fiscal 2022 (period ended January 29, 2022) that smashed past both consensus top- and bottom-line estimates. Shares of CSCO surged higher initially after its earnings were made public as the company offered up promising near term guidance, indicating that its positive momentum seen of late is expected to continue. We include shares of CSCO as an idea in both the Best Ideas Newsletter and Dividend Growth Newsletter portfolios. Cisco announced a 3% sequential increase in its quarterly dividend in conjunction
The Castle Trumps the Moat
February 16, 2022
Please select the image below to download the report. Backtested results are hypothetical and do not represent actual trading. Actual results may differ from backtested information being presented. Tickerized for firms held in the Morningstar (MORN) Wide Moat ETF (MOAT) at the time of this writing.
Dividend Growth Idea Realty Income Makes an Intriguing Purchase
February 16, 2022
Image Shown: Dividend growth idea Realty Income Corporation is acquiring its first real estate property in the gaming realm through a sale-leaseback transaction with Wynn Resorts Limited. Image Source: Realty Income Corporation – February 2022 IR Presentation By Callum Turcan On February 15, dividend growth idea Realty Income Corp (O) announced its 620th consecutive monthly dividend. Since going public in 1994, Realty Income has increased its monthly payout over 110 times. Realty Income is a real estate investment trust (‘REIT’) focused on single-tenant commercial properties. We include the REIT as an idea in our Dividend Growth Newsletter portfolio and continue to be big fans of Realty Income. Shares of O yield ~4.4% as of this writing. Recent Acquisition Realty Income
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
