Member Articles

Dividend Increases/Decreases for the Week August 21

by

Below we provide a list of firms that raised their dividends during the week ending August 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 American Financial (AFG): now $2.00 per share annual dividend, was $1.80. APTIV PFD A 5.5% (APTV.PA): now $1.4208 per share quarterly dividend. Atrion (ATRI): now $1.75 per share quarterly dividend, was $1.55. Banco Santander, S.A. GTD PFD SECS 6 (SAN.PB): now $0.2639 per share quarterly dividend, was $0.2556. Brighthouse Financial PFDs (BHFAO): now $0.5953/ADS quarterly dividend. Community Bank System (CBU): now $0.42 per share quarterly dividend, … Read more

ALERT: Newsletter Portfolio Changes; Investing Is Simple, Not Easy

by

Changes to the Newsletter portfolios Best Ideas Newsletter portfolio BRK.B: 8-13% à 3.5%-5% AAPL: 4.2%-6% à 6.5%-8% MSFT: 4.2%-6% à 6.5%-8% Dividend Growth Newsletter portfolio BKLN: 4.25%-6.5% à 0% KMI: 3.25%-4.25% à 0% LMT: 3.25%-4.5% à 6.25%-8.5% ORCL: 4.25%-6.5% à 6.25%-8.5% AAPL: 2.75%-4% à 3.25%-4.5% MSFT: 2.75%-4% à 6.25%-8.5% —– Hi everyone: Trust you are doing great. I wanted to let you know of a few newsletter portfolio changes we’re making today. In the Best Ideas Newsletter portfolio, we are reducing the position in Berkshire Hathaway (BRK.B) to the weighting range of 3.5%-5% from 8%-13%. Though we think Warren Buffett is getting back on track now that he has dumped the airlines and many of the banks, we no longer … Read more

Johnson & Johnson Buys Momenta Pharmaceuticals

by

Image Source: Johnson & Johnson – Second Quarter of Fiscal 2020 IR Earnings Presentation By Callum Turcan On August 19, Johnson & Johnson (JNJ) announced it was acquiring Momenta Pharmaceuticals Inc (MNTA) for $52.50 per share in cash through a deal worth $6.5 billion (or $6.1 billion when including Momenta Pharmaceuticals’ net cash position). At the end of June 2020, Momenta Pharmaceuticals had ~$0.45 billion in cash and cash equivalents on hand with no debt on the books. We include shares of JNJ as a holding in both our Best Ideas Newsletter and Dividend Growth Newsletter portfolios. Overview This deal will give Johnson & Johnson’s Janssen pharmaceutical unit access to Momenta Pharmaceutical’s drug pipeline portfolio which focuses on therapeutics that … Read more

Marriott International Can Survive COVID-19

by

Image Shown: Shares of Marriott International Inc have recovered somewhat from their March 2020 lows and are currently trading in the lower bound of our fair value estimate range. By Callum Turcan On August 10, Marriott International Inc (MAR) reported second quarter 2020 earnings that missed both consensus top- and bottom-line estimates. Marriott International’s financials have been devasted by the ongoing coronavirus (‘COVID-19’) pandemic, though its saving grace has been its asset-light business model which is built around property management and franchise fees. Most of its revenue comes from managing third-party locations and franchising out its various hotel brands to third-parties including Courtyard, Fairfield by Marriott, Residence Inn, Marriott Hotels, Sheraton, Westin, and others. Please note many of its franchised … Read more

Lockheed Martin Secures Major Aircraft Order

by

Image Shown: Lockheed Martin Corporation’s ‘Aeronautics’ segment is its largest in terms of operating profit. Management boosted the firm’s operating profit guidance for fiscal 2020 during Lockheed Martin’s latest earnings report. Image Source: Lockheed Martin Corporation – Second Quarter of Fiscal 2020 IR Earnings Presentation  By Callum Turcan On August 14, the US Department of Defense (‘DoD’) awarded Lockheed Martin Corporation (LMT) a ten-year $62.0 billion contract covering the sale of F-16 aircraft to overseas buyers. This is an “indefinite-delivery/indefinite-quantity (‘IDIQ’), fixed-price-incentive contract” and it is possible the ultimate sales figure under this deal will be lower than $62.0 billion. In the press release announcing the contract, the DoD noted the initial delivery order covers 90 aircraft and that this … Read more

Lyft Can’t Run on Fumes Forever

by

Image Shown: Lyft Inc’s business model is not well suited for the pandemic. Its financial performance was decimated during the second quarter of 2020 as its active rider base opted to stay home or use other methods of transportation. Image Source: Lyft Inc – Second Quarter of 2020 Supplemental Data By Callum Turcan On August 12, the ridesharing company Lyft Inc (LYFT) announced second quarter 2020 earnings that beat consensus bottom-line estimates but missed consensus top-line estimates. The ongoing coronavirus (‘COVID-19’) pandemic has posed a major headwind for Lyft due to workers commuting less, reduced demand from late-night bar patrons, and other factors. Management did note within Lyft’s earnings release that rideshares were up 78% in the month of July … Read more

August Best Ideas Newsletter!

by

Image: The Best Ideas Newsletter portfolio. We migrated to weighting ranges at the beginning of 2018. The image above is as of the close April 15. — Hi everyone: — Trust you are well.  — Portfolio concentration among strong-performing equities has been the key to outperformance. Since the last update, we’ve witnessed some big moves from our top-weighted entities: Berkshire Hathaway (+10.7%), Facebook (+8.7%), and PayPal (+11.2%). These three entities comprise roughly 34% of the Best Ideas Newsletter portfolio at the high end of the weighting ranges, more than offsetting the weaker performance from lower-weighted Cisco and Intel during the month. We continue to focus on over-weighting our “best of the best” ideas within a portfolio setting, and we’re hoping to … Read more

Two Exciting Names for Your Radar: PENN, SPCE

by

“Davey the Day Trader” meets space flight in this article that sums up the goings-on at two exciting companies, Penn National and Virgin Galactic. We think shares of PENN are fairly valued at the moment, and we won’t be taking a “flier” on Virgin Galactic, but we still think it is one worth watching. By Brian Nelson, CFA Penn National Gaming (PENN) Image Source: Penn National Gaming Dave Portnoy, “Davey the Day Trader,” has taken the investment community by storm, and not just because he lost a cool mil on Remark (MARK). He’s been taking on the “suits” of Wall Street as he calls it, and while the entertainment “value” is excellent, there’s just not much going on other than … Read more

Unicredit Struggles to Demonstrate Earnings Power

by

When one looks at individual bank interests and also the national champion nature of many banks that are closely tied to their home countries, it becomes difficult to picture how the overtraded European banking landscape will resolve itself. One scenario is perhaps by smaller banks coming together, though that might not really move the needle that much. We generally dislike the banking industry due to the arbitrary nature of its cash flows, weak economic returns, and highly-regulated nature, and we think Unicredit may be one to avoid, in particular. By Matthew Warren Unicredit (UNCRY) put up another measly quarter, results released August 6, this time with small positive underlying net profits of EUR 0.5 billion. Revenues were down 7.7% compared … Read more

Lloyds Banking Group Is Struggling Against the Tide

by

Lloyds Banking Group’s business model focused on being a “digitized, simple low risk, customer focused, U.K. financial services provider” sounds good on the surface, but uncertainty surrounding the U.K’s recovery makes this bank much more risky than some of its U.S. counterparts, in our view. Investors should take note the inherent leverage and riskiness of any banking business model, and Lloyds is no exception. By Matthew Warren and Brian Nelson, CFA On July 30, Lloyds Banking Group (LYG) reported a dismal set of results for the first half of 2020. Net income was down 16% and statutory profit after tax was only GBP 19 million. Revenues came under pressure due to lower rates and lesser customer activity, while the provision … Read more