ALERT: AT&T Reportedly Planning to Offer Fair Value to Buy DirecTV; We Think a Higher Offer Is in the Cards
May 13, 2014
On Monday, Bloomberg reported that AT&T (T) is in advanced talks to acquire all of the outstanding shares of DirecTV (DTV) for as much as ~$100 each, almost precisely at our $99 per share cash-flow-derived fair value estimate of DirecTV’s equity. We had previously outlined the strong case for a suitor to offer a price north of $99 per share for the pay-TV provider, and we believe that a higher offer price may be required to seal this deal for a couple reasons. First, the reported offer price, as is, represents essentially the fair value of DirecTV on a standalone basis, excluding any synergies and cost-savings that would accrue to the combined entity. DirecTV shareholders are entitled to a portion
MoneyShow Slide Deck: The Valuentum Dividend Cushion
May 12, 2014
Tuesday, May 13, 2014, 4:00 pm – 4:30 pm The Ultimate Dividend Growth Investing Tool Valuentum’s President of Equity Research Brian Nelson, CFA, walks through the benefits of intelligent dividend growth investing and the importance of not only focusing on the payout ratio but also future cash flows when assessing the safety and potential growth of a firm’s dividend. In this must-attend… Please select the image below or click to view the presentation. Join Brian Nelson, CFA, at The MoneyShow Las Vegas, May 12-15, 2014. Brian will share his investing strategies with you face to face in two presentations: The Ultimate Dividend Growth Investing Tool and 3 Top Stock Ideas for Your Radar. If you are interested in meeting
Dividend Increases for the Week Ending May 9
May 12, 2014
Below we provide a list of firms that raised their dividends during the week ending May 9. 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 AAON (AAON): now $0.13 per share semi-annual dividend, was $0.10. Ametek (AME): now $0.09 per share quarterly dividend, was $0.06. Argo Group (AGII): now $0.18 per share quarterly dividend, was $0.15. Arsenal Energy (AEYIF): now $0.065 per share quarterly dividend, was $0.06. Assurant (AIZ): now $0.27 per share quarterly dividend, was $0.25. Autoliv (ALV): now $0.54 per share quarterly dividend, was $0.52. Baker Hughes (BHI): now
Meet Members of the Valuentum Team at the World MoneyShow in Las Vegas – Register Free
May 11, 2014
Las Vegas | May 12 – 15, 2014 • Caesars Palace Join Brian Nelson, CFA, at The MoneyShow Las Vegas, May 12-15, 2014. Brian will share his investing strategies with you face to face in two presentations: The Ultimate Dividend Growth Investing Tool and 3 Top Stock Ideas for Your Radar. If you are interested in meeting Brian and other members of the Valuentum Team in person, please click here to register. View exhibitor list >>> Tuesday, May 13, 2014, 4:00 pm – 4:30 pm The Ultimate Dividend Growth Investing Tool Valuentum’s President of Equity Research Brian Nelson, CFA, walks through the benefits of intelligent dividend growth investing and the importance of not only focusing on the payout ratio but also
ALERT: Apple Pulls Forward iPhone 6 Launch!
May 9, 2014
On the same day Apple (AAPL) announced the purchase of Beats Electronics for $3.2 billion, Reuters reported that a Taiwanese media source stated that Apple will release the next iteration of the iPhone in August, one month earlier than expectations. The $3.2 billion purchase price of headphone maker and music-streaming service Beats is economically-neutral from our standpoint, and in the context of its massive share repurchase program and the firm’s $500 billion market capitalization, the net impact of the transaction is effectively immaterial. In any case, the deal will bolster Apple’s music offering in the face of growing competition from Pandora (P), Spotify, Rhapsody, and Google’s (GOOG) YouTube, and give it a platform to drive a streaming and subscription-based business
Ford Announces $1.8 Billion Share Buyback; Reports Strong April Sales Growth in China
May 9, 2014
We believe investors have a tremendous opportunity to be holders of Ford’s (F) equity. We can do a deep dive into the reasons why in this article, but we encourage members to peruse our website, especially Ford’s landing page to examine our investment thesis on the automaker. On Ford’s landing page, members can view the company’s 16-page equity report and its dividend report, as well as a list of the recent Valuentum commentary on the company and the firm’s corporate press releases. Our website may be slightly different than others’ in that we house pdf reports of firms on their respective landing pages — in addition to providing articles and press releases and other content. We can’t possibly put all
ALERT: DirecTV Pops After Close
May 7, 2014
<< DirecTV’s Valuation Thesis, May 1 << DirecTV’s First Quarter Analysis, May 6 According to Reuters citing sources from Dow Jones, DirecTV (DTV) is working with advisers on a possible merger with AT&T (T). Shares have advanced to nearly $90 in after-hours trading, converging to our $99 per share fair value estimate. DirecTV is a holding in the Best Ideas portfolio, where we house all of our best ideas. DirecTV’s landing page >> More details to come!
The Alstom Situation
May 6, 2014
French energy firm Alstom has been in the news a lot recently. From General Electric’s (GE) initial interest in the firm reported April 23 to Siemens’ (SI) offering to top GE’s bid April 27 to the French government politically opposing GE’s bid for Alstom’s assets May 5, the saga continues. As of the latest information available (May 6), Alstom continues to review both GE’s and Siemens’ respective offers: The Board of Directors of Alstom announced…that it has received a binding offer from General Electric to acquire its Energy activities. The scope of the transaction includes the Thermal Power, Renewable Power and Grid Sectors, as well as corporate and shared services. With 65,000 employees, these businesses registered €14.8Bn in sales in
Why We’re Keeping Chevron As Our Favorite Dividend Growth Idea in Big Oil
May 6, 2014
Our dividend growth thesis on Chevron (CVX) has been rather simple at the core: For investors seeking dividend growth exposure to Big Oil, Chevron hands-down has the most financial flexibility of all the majors – irrespective of what happens to energy prices – and therefore, we think the firm is extremely well-positioned among its peer group to have the best dividend growth prospects through the course of the multi-year (and inevitably volatile) energy price cycle. A look at a breakdown among the net cash positions across the energy majors in the third quarter of last year, for example, shows Chevron with a net-neutral net cash position, while its peers BP (BP), Exxon (XOM), ConocoPhillips (COP) and Shell (RDS) all revealed
DirecTV Shines in First Quarter; Merger Talk Icing on the Cake
May 6, 2014
We profiled pay TV provider DirecTV (DTV) earlier last week (click here), branding it as a Valuentum stock, and the firm’s first-quarter performance, released today, helped to support our view on shares. The company surpassed 38 million total subscribers in the quarter (including Sky Mexico, which is accounted for using the equity method), while adjusted operating profit before depreciation and amortization (OPBDA) advanced 7% on an adjusted basis. The firm’s free cash growth was excellent during the period, jumping 25%, to $886 million. Though traditional free cash flow (cash from operations less capital expenditures) is different than enterprise free cash flow (free cash flow to the firm), they are highly correlated. The strong cash flow performance in the quarter offers
