Video: An Overview of Our 16-page Stock Research Reports
October 15, 2016
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Where I Went Wrong on Gilead
October 14, 2016
Image Source: torbakhopper By Brian Nelson, CFA Our trade(s) in the Best Ideas Newsletter portfolio with respect to hepatitis-C juggernaut Gilead (GILD) is (are) not something I’m proud of. I know the Best Ideas Newsletter is performing fantastically, and we continue to outdistance the broad market benchmark, but I’m not satisfied unless I get everything right, even though this is an unattainable goal. Here’s what happened. I was enamored by Gilead. The pharma giant had found a cure for hep-C. It was a free-cash-flow generating behemoth, and its balance sheet was solid. What I did not anticipate was just how easily its patent on Harvoni/Sovaldi could be circumvented and how the economics would be truncated, both with respect to volume
The Times They Are a-Changing
October 13, 2016
This article was first published September 2013. It has not been updated. It has been republished to recognize the Nobel Prize in Literature being awarded to Bob Dylan October 13, 2016. Image Source: Mikko Tarvainen Come writers and critics Who prophesize with your pen And keep your eyes wide The chance won’t come again And don’t speak too soon For the wheel’s still in spin And there’s no tellin’ who That it’s namin’ For the loser now Will be later to win For the times they are a-changin’. — Bob Dylan – Times They Are a-Changin I was reading an article the other day that had come to the conclusion that stock funds will get more asset flows (read: be easier
I Thought I Made a Mistake
October 13, 2016
By Brian Nelson, CFA It was nearing the end of 2015, and I don’t think I was more bullish on a stock than Intel (INTC). In October 2015, I published that “Intel may have a breakout year in 2016.” I liked what Intel had done to keep AMD’s (AMD) back against the wall, and the chip giant was making nice strides in the mobile market against Qualcomm (QCOM), particularly with key phone-maker, Apple (AAPL). I liked the acquisition of Altera in part because the company is a free-cash-flow generating machine with little capital intensity. Field-programmable gate arrays (FPGAs) will continue to reshape the semiconductor landscape, and the Altera purchase will give Intel a leg up. Well, it didn’t take long
Understanding the Chartered Financial Analyst (CFA) Designation
October 13, 2016
“Among the countless finance degrees around the world, the Chartered Financial Analyst qualification has become the gold standard.” – Financial Times, 13 August 2010 “[The] qualification is roughly equivalent to a specialized postgraduate finance degree, including a mixture of economics, ethics, law, and accountancy… Whereas there are tens of thousands of finance degrees available around the world, ranging from the excellent to the worthless, there is only one CFA, managed and examined by an American association of financial professionals, the CFA Institute.” – the Economist From the CFA Institute: “The Chartered Financial Analyst (CFA) charter is an investment credential that, for more than 60 years, has been the global standard for embodying the integrity, dedication, and advanced skills needed to
Apple V. Samsung
October 13, 2016
Image Source: Lr43_L1000009 By Kris Rosemann Samsung’s (SSNLF) issues with its Galaxy Note 7 smartphone began in late August when the firm postponed shipments of the smartphone due to product quality testing. The event was not a major issue, as early demand for the device had outpaced supply, already causing shipment delays to some markets. Shortly after the delay was announced, claims of the smartphones’ batteries exploding surfaced, and Samsung subsequently announced it would recall Galaxy Note 7s across the globe. The recall announcement only began the saga of despair for the Galaxy Note 7 series. One week later, the FAA issued a warning that the devices could be an airborne fire hazard and suggested consumers refrain from using the smartphones
Retail Weakness: Blame the Election?
October 13, 2016
Image Source: DonkeyHotey By Kris Rosemann The 2016 election cycle has been one characterized by unprecedented amounts of criticism and accusations, of both the personal and political variety, and it may be true that the perceived political environment from the view of the general public has not been in such a state of uncertainty for some time. Let’s not get into the details of who called whom what in last night’s Presidential debate, but some parents were reportedly not allowing their children to watch the debate out of fear that their values or outlook on democracy could be skewed. But could the uncertainty surrounding the election actually be enough to impact consumer activity at retail outlets and restaurants? Some are
Honeywell’s Stock Up 170% Since End of 2009; GE a Better Bet?
October 10, 2016
Has Honeywell’s business value truly increased by 170% in less than seven years, or are shares overheated? We think investors should continue to exercise prudence in today’s stretched market. GE may be a better relative bet than Honeywell. By Brian Nelson, CFA What a wonderful ride it has been these past seven years from the March 2009 panic bottom. The S&P 500 (SPY) has experienced one of its strongest showings in history during this time, and even large caps have posted returns that have turned heads. The share price of Honeywell (HON), for one, has leapt more than 170% since the end of 2009, simply a huge run for a company of its size. The question, however, on everyone’s mind:
Dividend Increases/Decreases for the Week Ending October 7
October 10, 2016
Below we provide a list of firms that raised/lowered their dividends during the week ending October 7. 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 American Financial (AFG): now $0.3125 per share quarterly dividend, was $0.28. Bank of the Ozarks (OZRK): now $0.165 per share quarterly dividend, was $0.16. Enterprise Products (EPD): now $0.405 per share quarterly dividend, was $0.40. FNB Bancorp (FNBG): now $0.16 per share quarterly dividend, was $0.15. Genesis Energy (GEL): now $0.70 per share quarterly dividend, was $0.69. Ingersoll-Rand (IR): now $0.40 per share quarterly dividend, was
Currency: Cases in Probabilistic Thinking
October 8, 2016
The rally in the Mexican peso relative to the US dollar during the first Trump-Clinton debate of 2016 showcased the increased likelihood of a Clinton victory, in light of Trump’s current political agenda. Instances like this, where currency markets serve to act as a probability indicator of the likelihood of a future event, have occurred through the course of history, the most fasinating of which happened during the American Civil War and with Confederate scrip specifically. Image Source: Bloomberg, “Mexican Peso Gives Clearest Signal Trump Lost Debate“ By Brian Nelson, CFA At Valuentum, we talk a lot about how markets act as “discounting” mechanisms of the probability of future events, and more specifically as it relates to stocks, how a
