Kinder Morgan’s Dividend Is Much Healthier These Days
October 17, 2024
Image: Kinder Morgan’s shares have done quite well thanks to improved free cash flow performance. By Brian Nelson, CFA On October 16, pipeline giant Kinder Morgan (KMI) reported weaker than expected third quarter results, with both revenue and non-GAAP earnings per share coming in lower than what the Street was looking for. Adjusted EBITDA expanded 2% in the third quarter on a year-over-year basis, while net income attributable to KMI came in at $625 million, higher than the $532 million mark it posted in the year-ago quarter. Third quarter earnings per share was up 17% compared to the same period last year, but adjusted earnings per share of $0.25 and distributable cash flow of $0.49 per share were flat on
Taiwan Semiconductor Benefiting from Strong Smartphone and AI Demand
October 17, 2024
Image: Taiwan Semiconductor released better than expected results. By Brian Nelson, CFA Taiwan Semiconductor (TSM) reported excellent third quarter results on October 17. In the quarter, consolidated revenue came in at NT$759.69 billion, net income was NT$325.26 billion while diluted earnings per share was NT$12.54 (US$1.94 per ADR unit), all coming in ahead of expectations. On a year over year basis, revenue grew 39%, while net income and diluted earnings per share increased 54.2%. On a sequential basis, revenue advanced 12.8%, while net income leapt 31.2% higher. Return on equity was 33.4% in the quarter, up 7.6 percentage points on a year-over-year basis. On a US-dollar basis, third quarter revenue of $23.5 billion advanced 36% year-over-year, ahead of guidance calling
ASML Holding Lowers 2025 Outlook
October 16, 2024
Image: ASML Holding is falling from recent highs as its third quarter report and outlook disappointed investors. By Brian Nelson, CFA On October 15, ASML Holding (ASML) reported disappointing results for the third quarter of 2024, as the firm’s quarterly net bookings were weaker than the market was expecting. Third quarter total net sales were €7.5 billion (better than consensus of €7.17 billion), while it put up a gross margin of 50.8%, resulting in net income of €2.1 billion in the quarter (better than consensus of €1.91 billion). The big news, however, was that net bookings in the third quarter were €2.6 billion versus consensus expectations of €5.39 billion. Management had the following to say about the quarter, adjusting its
Goldman Sachs Beats Third Quarter Estimates, Puts Up Strong Economic Returns
October 16, 2024
Image: Goldman Sachs’ shares have done well the past couple years. By Brian Nelson, CFA On October 15, Goldman Sachs (GS) reported better than expected third-quarter results with revenue and GAAP earnings per share topping the consensus forecast. Net revenue and net earnings in the quarter came in at $12.7 billion and $2.99 billion, respectively, while diluted earnings per common share was $8.40 for the third quarter of 2024, better than the consensus forecast of $6.92 per share. Net revenues were up 7% year-over-year thanks to higher net revenues in Global Banking & Markets and Asset & Wealth Management, offset in part by lower net revenues in Platform Solutions, while diluted earnings per share was modestly lower on a year-over-year
Johnson & Johnson’s Shares Look Fairly Valued
October 16, 2024
By Brian Nelson, CFA Johnson & Johnson (JNJ) reported third-quarter results on October 15 that beat the consensus forecast for both revenue and non-GAAP earnings per share. The company posted adjusted operational sales growth of 5.4% thanks to 6.4% expansion in Innovative Medicine and 3.7% growth in MedTech, while adjusted earnings per share came in at $2.42 in the quarter, down 9% as acquired IPR&D impacted results. Year-to-date free cash flow came in approximately $14 billion, up from $12 billion in the year ago period. J&J noted that it continues to advance its pipeline, including approvals for TREMFYA in ulcerative colitis and RYBREVANT + LAZCLUZE in non-small cell lung cancer. Management commentary was upbeat in the quarter: Johnson & Johnson’s
UnitedHealth Remains a Free Cash Flow Generating Powerhouse
October 15, 2024
Image: UnitedHealth’s shares have done well the past few years, but a gloomy outlook for 2025 has prompted a selloff. By Brian Nelson, CFA United Health (UNH) reported better than expected third quarter results on October 15. Third quarter revenue grew $8.5 billion, to $100.8 billion, thanks to growth in people served at Optum and UnitedHealthcare. Adjusted earnings from operations came in at $9 billion, which includes the Change Healthcare business disruption impacts, but excludes the cyberattack and direct response costs. Adjusted earnings per share was $7.15 in the quarter. The big concern in the quarter was the firm’s medical care ratio: The third quarter 2024 medical care ratio was 85.2% compared to 82.3% last year. Among factors contributing to
JPMorgan Continues to Generate Value for Shareholders
October 15, 2024
Image Source: Hakan Dahlstrom By Brian Nelson, CFA JPMorgan (JPM) reported excellent third quarter results on October 11. Reported revenue of $42.7 billion and GAAP earnings per share of $4.37 both beat the consensus forecast. Credit costs were $3.1 billion, which included $2.1 billion of net charge-offs and $1 billion in net reserve build. Average loans were up 1% year-over-year, while average deposits advanced at a similar rate. For the third quarter, JPMorgan reported an ROE of 16% and ROTCE of 19%, both measures indicating nice value generation for investors. CEO Jamie Dimon had the following to say about the quarter and current economic conditions: The Firm reported strong underlying business and financial results in the third quarter, generating net income
Dividend Increases/Decreases for the Week of October 11
October 11, 2024
Below we provide a list of firms that raised their dividends during the week ending October 11. 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 Agree Realty (ADC): now $0.253 per share monthly dividend, was $0.250. American Mobile Dental Corp. (AMBD): now $0.7085 per share quarterly dividend. AMFI Corp. (AFIPA): now $275.00 per share dividend, was $270.00. Avient (AVNT): now $0.27 per share quarterly dividend, was $0.26. Bank of Hawaii Corporation DEP SHS SER B (BOH.PR.B): now $0.5000 per share quarterly dividend, was $0.2223. Calvin B. Taylor Bankshares (TYCB):
Domino’s Pizza Remains an Attractive Long-Term Story
October 10, 2024
By Brian Nelson, CFA On October 10, Domino’s Pizza (DPZ) reported mixed third quarter fiscal 2024 results with GAAP earnings per share coming in above expectations, while revenue came up short relative to the Street’s forecast. Excluding foreign currency impacts, global retail sales expanded 5.1% thanks to higher supply chain, U.S. franchise advertising and U.S. franchise royalties and fees revenues, while U.S. same store sales growth came in at 3%. International same store sales growth, excluding foreign currency impacts, was 0.8%, while it grew global net stores by 72 in the quarter. Excluding foreign currency impacts, income from operations advanced 5.7% in the period thanks to gross margin dollar growth within supply chain and higher U.S. franchise royalties and fees.
PepsiCo Experiencing Subdued Growth, Business Disruptions Due to Geopolitical Tensions
October 8, 2024
Image: PepsiCo has traded sideways for most of the past couple years. By Brian Nelson, CFA On October 8, PepsiCo (PEP) reported mixed third-quarter results with revenue coming up a bit short of consensus and non-GAAP earnings per share beating the Street’s forecast. The headline numbers weren’t great with net revenue falling 0.6% and earnings per share falling 5%. Organic revenue growth was 1.3% in the third quarter (consensus was for 3% growth), with core earnings per share coming in at $2.31, with core constant currency operating profit up 6% and core constant currency earnings per share up 5%. On an organic revenue basis, Frito-Lay North America experienced a 1% decline, while Quaker Foods North America fell 13%. PepsiCo Beverages
