Brian Nelson

What About BDCs?

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Business Development Companies, or BDCs, are often considered by dividend investors as a result of their quite sizable dividend yields, as compared to the overall market. In this piece, let’s take a look at how these companies operate and then also compare some important metrics between the various players. First, let’s looks at the below slide from Prospect Capital, which highlights some important differentiating features of BDCs. Image Source: Prospect Capital Investor Presentation Importantly, please know that you will need to consult a tax professional to determine how to treat the various dividend and return of capital from BDCs. Let’s also look at the below graphic from Prospect Capital (PSEC), which highlights the growth in BDCs over the past 10 … Read more

Chevron’s Permian Opportunity, Outsize Dividend Yield

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Image Source: Chevron Corporation – IR Presentation By Callum Turcan Last year, the storied energy giant Chevron Corporation (CVX) produced 2.9 million barrels of oil equivalent per day on average and the company ended 2018 with 12.1 billion BOE in proved reserves on a net basis. Chevron’s upstream production base climbed by 13% from 2016 to 2018 while its proved reserves increased 8% during this period, led by growth at its Permian Basin operations. Management intends on growing Chevron’s downstream presence to support rising Permian crude oil volumes. We would like to draw attention to Chevron’s Permian operations as we see that having an outsized influence on its growth trajectory. Shares of CVX yield 3.8% as of this writing and … Read more

Dividend Increases/Decreases for the Week Ending June 28

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Below we provide a list of firms that raised their dividends during the week ending June 28. 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 Empire (EMLAF): now CAD 0.12 per share quarterly dividend, was CAD 0.11. First Bancorp (FNLC): now $0.30 per share quarterly dividend, was $0.29. Glacier Bancorp (GBCI): now $0.27 per share quarterly dividend, was $0.26. Hingham Institution for Savings (HIFS): now $0.39 per share quarterly dividend, was $0.38. Investar (ISTR): now $0.0551 per share quarterly dividend, was $0.0525. John Wiley & Sons (JW.A): now $0.34 per share … Read more

Visa, Concentration Bets and Facebook’s Gift

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Image: In late December, we increased the position in Facebook (FB) while shares were in the mid-$130s. The stock is up huge since then.     Order Value Trap here.    Hi everyone,   I’m still enjoying my get-away. It feels like it has been about 8 years since I’ve been able to totally tune out of the markets for a day or two, but here I am writing to you anyway. I really appreciate your being there. I really mean it. Today, I wanted to talk a little about concentration bets.   First, however, I want to emphasize the importance of diversification. I’m not going to go into the quantitative explanation, but rather, keep it really simple: it’s better … Read more

Value Trap Is Winning And So Are You!

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Image: Value Trap received acclaim at the prestigious Next Generation Indie Awards at the Mayflower Hotel in Washington DC. Shown: Value Trap at the American Library Association conference Headline Books booth June 22.     Order Value Trap here.    Hi everyone,   This week has been met with a lot of traveling, and I thank you for your patience as I seek to catch up on your emails. Also, please note the weekly datascreener will not be updated this week, but refreshed upon our team’s return to the offices next weekend.   For starters, I want to thank each and every one of you out there for your continued support. The field of finance has simply been turned upside … Read more

Dividend Increases/Decreases for the Week Ending June 21

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Below we provide a list of firms that raised their dividends during the week ending June 21. 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 ALPS Cohen & Steers Global Realty Majors ETF (GRI): now $0.3726 per share quarterly dividend, was $0.3464. ALPS Equal Sector Weight ETF (EQL): now $0.4145 per share quarterly dividend, was $0.3067. Bank of Commerce (BOCH): now $0.05 per share quarterly dividend, was $0.04. Cross Timbers Royalty Trust (CRT): now $0.090063 per share monthly dividend, was $0.082025. Darden Restaurants (DRI): now $0.88 per share quarterly dividend, was … Read more

Our Reports on Stocks in the Industrial Minerals Industry

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Image Source: Alliance Resource Partners Structure of the Industrial Minerals Industry The volatile industrial minerals space contains firms that primarily focus on coal mining. The profitability of constituents largely depends on coal prices, which are tied to factors beyond their control–such as the price of alternatives (natural gas), the demand for electricity/steel, and the strength of the global economy. Customers typically have bargaining power under customary long-term supply agreements and can terminate contracts under certain scenarios (e.g. a spike in transportation costs). Regulations and organized labor add further uncertainty to operations. We don’t like the structure of the group. We’ve dropped coverage of stocks in the Industrial Minerals space: ARLP, CCJ, CNX, HCR, NRP.

Broadcom Plummets After Cutting Guidance

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Image Source: Florian Knodt Broadcom resets investor expectations, sending shares of the company and peers lower. Broadcom sports a juicy yield. By Callum Turcan Global semiconductor and infrastructure software giant Broadcom (AVGO) spooked the market during its fiscal second quarter report, released June 13, by sharply revising its revenue forecast for FY2019 lower (its FY2019 ends November 3, 2019). Shares of the company finished lower ~6% on the trading session June 14. As of this writing, Broadcom’s shares yield a juicy 4.0% Guidance Moves Lower Earlier this year, Broadcom set some lofty expectations. In its fiscal first quarter FY2019 (ended February 3, 2019) earnings release, released March 14, management issued guidance for the full fiscal year that called for $24.5 billion in … Read more

Our Reports on Stocks in the Metals and Mining (Aluminum) Industry

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Image Source: Alcoa Structure of the Aluminum Industry The aluminum industry, a subset of the industrial metals group, remains highly cyclical. The threat of production overcapacity, the level of global metal inventories, and changes in economic growth expectations (especially China) can cause significant volatility in the prices of aluminum and other industrial metals. Sustained weak prices coupled with rising costs for energy, which is used heavily in metal production, could have disastrous implications on the group’s financial condition. Competition remains fierce, and recent industry consolidation has done little to change this dynamic. We don’t like the group. We’ve dropped coverage of stocks in the Aluminum industry: AA, ACH, ATI, CENX, KALU.

Dividend Increases/Decreases for the Week Ending June 14

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Below we provide a list of firms that raised their dividends during the week ending June 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 Andrew Peller (ADWPF): now $0.215 per share annual dividend on Class A shares, was $0.205. Blackstone/GSO Long-Short Credit Income Fund (BGX): now $0.122 per share monthly dividend, was $0.115. Blackstone/GSO Strategic Credit Fund (BGB): now $0.114 per share monthly dividend, was $0.109. Capstead Mortgage (CMO): now $0.12 per share quarterly dividend, was $0.08. Caseys General Stores (CASY): now $0.32 per share quarterly dividend, was $0.29. Cherry … Read more