Novartis’ Clinical Pipeline Continues to Innovate
July 19, 2017
We continue to be impressed with the depth of Novartis’ clinical pipeline, which should aid in the company’s acceleration from the revenue cliff experienced as a result of the patent loss of top-selling product Gleevec. We are adding Novartis to the portfolio of the Dividend Growth Newsletter. By Alexander J. Poulos Overview Novartis’ (NVS) primary strength, in our view, remains the company’s diverse revenue stream. Thus far, for example, Novartis has capably handled the revenue cliff from the loss of patent protection of its top-selling product Gleevec admirably, with only a 1% drop in sales during the first half of 2016. Though such a dynamic can change in coming periods, we have found the relative predictability of Novartis’ revenue stream
Stocks in the News: Harley-Davidson, Johnson & Johnson, Netflix
July 18, 2017
Earnings season is picking up. Let’s evaluate a few quarterly reports from some bellwethers. By Brian Nelson, CFA Harley-Davidson (HOG) Not Revving Like It Used To We plan to update our report and fair value estimate of Harley-Davidson following its weak second-quarter report, released July 18. Both revenue and net income faced pressure on a year-over-year basis in the period, with earnings per share falling 4.5%. Management spoke of “challenging market conditions,” and the executive team is right about that: Harley-Davidson worldwide retail motorcycle sales fell 6.7% in the quarter, while Harley-Davidson retail motorcycle sales in the US were down more than 9%. The company’s US market share is holding up (~48.5%), but we are starting to worry about more
Dividend Increases/Decreases for the Week Ending July 14
July 17, 2017
Below we provide a list of firms that raised/lowered their dividends during the week ending July 14. The dividend reports of covered firms on this list will be updated shortly with the new information. To access our dividend reports use the ‘Symbol’ search box in our website header. Firms Raising Their Dividends This Week Acme United (ACU): now $0.11 per share quarterly dividend, was $0.10. Antero Midstream (AM): now $0.32 per share quarterly dividend, was $0.30. Ares Dynamic Credit Allocation Fund (ARDC): now $0.1050 per share monthly dividend, was $0.1025. Basset Furniture (BSET): now $0.11 per share quarterly dividend, was $0.10. China Petroleum & Chemical (SNP): now $2.2013 per share semi-annual dividend, was $1.0532. Computer Services (CSVI): now $0.31 per
Valuentum’s July Edition of Its Best Ideas Newsletter
July 15, 2017
To download the July edition of the Best Ideas Newsletter, please select here (pdf).
Systemic Risk in These Frothy Times
July 14, 2017
Let’s talk about index investing, market valuations, and mention how a few ideas in the Best Ideas Newsletter are doing. By Brian Nelson, CFA For most investors during most parts of the economic cycle, index investing (VOO), or holding a broad basket of stocks that approximate the returns of a large market index may make a lot of sense. I have always said this from the very beginning: Individual stock selection is not for everyone. What may not be well-known, however, is that index funds have experienced multi-year periods of both outperformance and underperformance relative to actively-managed funds since the dawning of the very first index fund many decades ago. I’m worried that some investors today may not have this
Important Valuentum Announcements
July 12, 2017
We have a few important announcements and a couple reminders to share. Hi everyone, I hope you are doing great! I wanted to let you know of a few things that I am very excited about. First, in case you missed the rollout of our enhanced stock and ETF pages, you can read that message here. The enhanced pages make it easier to access and consume data on companies on our website, including their respective fair value estimates, Dividend Cushion ratios, and beyond. We plan to continue to develop these pages to make them as user-friendly as possible. Our goal, however, is to keep them as free from potential bias as possible, so at the moment, outside news services are
Analyzing the S&P SPDR Biotech ETF
July 12, 2017
ETFs are rapidly becoming the preferred investment vehicle to gain broad exposure to a particular sector. The biotech industry is no different with two distinct ETFs dominating the niche. The article discusses the unique characteristics of the SPDR Biotech ETF to determine the merits of the idea. By Alexander J. Poulos Introducing the S&P Spider Biotech ETF The SPDR S&P Biotech ETF (XBI) is a position weighted index with the top 10 components accounting for less than 25% of the overall assets of the index (see image below). The XBI differs sharply from its primary rival the iShares Nasdaq Biotech Index ETF (IBB) which is market-cap weighted with industry stalwarts such as Amgen (AMGN) accounting for over 8% of the
ETF Analysis: Consumer Discretionary
July 11, 2017
Please select the image below to download the report.
Loxo Oncology Presents Compelling Data on Its TRK Inhibitors
July 11, 2017
Image Source: Loxo Oncology The field of oncology remains an area of intense focus with a dire need for new novel therapies. Loxo Oncology generated lots of excitement with the release of its clinical data for Larotrectinib, a TRK-inhibitor for the treatment of a diverse number of tumors. By Alexander J. Poulos TRK Fusion Loxo Oncology (LOXO) is targeting new therapies that take aim at the tropomyosin receptor kinase (TRK) gene abnormalities that lead to TRK-fusion cancers. A defective TRK gene can fuse with another otherwise healthy gene resulting in abnormal growth. The newly fused cell will continue to grow leading to tumor growth.The abnormal TRK fusion gene is witnessed in a wide swath of tumors–genetic testing can help identify
