Member Articles

SMART Global Holdings’ Headwinds Highlight Potential Gross Margin Pressure in Memory

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Image source: SMART Global investor presentation Shares of data and storage firm SMART Global dropped precipitously following its fiscal 2019 first quarter report. A change in Brazil’s local content rules and higher levels of seasonality have impacted its top-line and gross margin expectations and reduced visibility in its business. Potentially volatile gross margin performance is a key risk of the memory space. By Kris Rosemann Shares of SMART Global Holdings (SGH), a leader in data compute and storage products and solutions, faced significant selling pressure following its fiscal 2019 first quarter report, results released January 8, as a result of expectations for lower top-line performance in its Brazilian operations, which accounted for just over half of fiscal 2019 first quarter … Read more

Dividend Increases/Decreases for the Week Ending January 11

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Below we provide a list of firms that raised their dividends during the week ending January 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 AbbVie (ABBV): now $1.07 per share quarterly dividend, was $0.96. Atco (ACLLF): now CAD 0.4048 per share quarterly dividend, was CAD 0.3766. Bank of America Deposit Shs Repr 1/1200th Fltg Rate Non Cum Pfd Shs Series -2- (BML.PH): now $0.21446 per share quarterly dividend, was $0.19167. Canadian Utilities (CDUAF): now CAD 0.4277 per share quarterly dividend, was CAD 0.3933. Codorus Valley (CVLY): now $0.16 per share … Read more

New 10s! — Stock Report Updates — Triage During Market Volatility

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We have updated our 16-page equity and dividend reports for a number of high-profile companies in our coverage universe and have provided a table summarizing the new fair value estimates, Dividend Cushion ratios, and other key metrics following the updates for your convenience. By Valuentum Analysts We’ve been actively updating select reports through the course of this market swoon, and we have provided the table above for your convenience.  Guess what — Facebook (FB) and Google (GOOG, GOOGL) are now registering 10s on the Valuentum Buying Index again! These two companies are also the highest weighted equities in the simulated Best Ideas Newsletter portfolio. There’s a lot of “hair” on both names, given political and regulatory risks, and both may experience … Read more

We Still Like PayPal

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Image shown: PayPal has absolutely trounced the market since we retained it in the simulated Best Ideas Newsletter portfolio after its split from eBay. Simulated Best Ideas Newsletter portfolio idea PayPal has trounced the market by more than 100 percentage points since it split from eBay in July 2015. We continue to like shares. By Brian Nelson, CFA PayPal (PYPL) split from eBay (EBAY) in July 2015, and we couldn’t be more pleased with its performance since then. The company has exceeded the market’s return by more than 100 percentage points. This is simply incredible, and we hope that you are pleased. We’re also liking how a lot of our ideas are acting with respect to relative strength in this … Read more

The Intricacies of the Valuentum Process

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Let’s take a quick overview of the Valuentum processes for capital appreciation and dividend growth with a discussion of how we use the Valuentum Buying Index and the Dividend Cushion ratio. By Brian Nelson, CFA There is a lot behind the Valuentum processes for capital appreciation and dividend growth, respectively, and both the criteria for inclusion to either the simulated Best Ideas Newsletter portfolio and simulated Dividend Growth Newsletter portfolio are different. Our best ideas at any time, however, are always included in the simulated newsletter portfolios. We use our research as a means to identify new ideas for consideration in the simulated newsletter portfolios, as well as to consider removing ideas from the simulated newsletter portfolios. As it relates to … Read more

Catching the Bottom?

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Image shown: The depths of how far the S&P 500 (SPY) has fallen more recently, and the timing of the decision to move to being “fully invested” in simulated Best Ideas Newsletter portfolio and simulated Dividend Growth Newsletter portfolio.   No Changes to Simulated Newsletter portfolios. This article was sent to members via email January 9. That email can be found at the link that follows this article. By Brian Nelson, CFA On the evening of December 26, we emailed members that we were moving to “fully invested” in both the simulated Best Ideas Newsletter and simulated Dividend Growth Newsletter portfolio. First of all, please let me apologize. I wanted to stay in front of members during one of the most volatile times … Read more

Best Ideas Newsletter Idea Dollar General Strong in Difficult Market

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Image shown: Dollar General has exceeded the market’s return by more than 50 percentage points since being added to the simulated Best Ideas Newsletter in April 2017. The dollar stores are a nice area to be when the economic environment grows more uncertain, and we continue to like Dollar General as the play in this area. It remains a staple in the Best Ideas Newsletter portfolio. By Brian Nelson, CFA There may be one certainty when it comes to the economic environment, and that is uncertainty. The markets have had one of the best bull-runs in history since the doldrums of the March 2009 bottom, and perhaps nobody could have predicted the magnitude of the pace of economic expansion since … Read more

Markets Up Big; Upside Volatility

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Image shown: The S&P 500 ETF (SPY) since August 2017. The index has broken through support and is now bouncing back to resistance. By Brian Nelson, CFA Good morning everyone, Are you watching these markets? This is incredible. The Dow finished down 660 points yesterday (briefly dropping 700 points), and today, the Dow is currently trading up 600 points at the time of this writing. Granted, there was Apple’s (AAPL) poor first-quarter 2019 guidance yesterday and the strong jobs report today, but this volatility is not “normal,” no matter what others are saying. A couple announcements up front. For those that already ordered our book Value Trap, I will send you the pdf download to your email address just to make sure … Read more

Dividend Increases/Decreases for the Week Ending January 4

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Below we provide a list of firms that raised their dividends during the week ending January 4. 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 Bank OZK (OZK): now $0.22 per share quarterly dividend, was $0.21. Brandywine Realty Trust (BDN): now $0.19 per share quarterly dividend, was $0.18. Bristol-Myers Squibb (BMY): now $0.41 per share quarterly dividend, was $0.40. Owens Corning (OC): now $0.22 per share quarterly dividend, was $0.21. Preferred Bank (PFBC): now $0.30 per share quarterly dividend, was $0.25. Templeton Emerging Markets Income Fund (TEI): now $0.0655 per share … Read more

Fully-Invested? Why? Thoughts on Microsoft and Eli Lilly, and Celgene

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Our methodology is really easy to understand once you get to know the things we’re looking at. There’s also some subjectivity in how we implement our thoughts in the simulated newsletter portfolios, and please stop calling what we do advice. We’re not an advisor. We’re not a broker. We’re a financial publisher. While we’re at it, let’s talk a bit about Microsoft, Eli Lilly, and Celgene through the lens of our methodology. By Kris Rosemann and Brian Nelson, CFA I know many of you have been following our simulated newsletter portfolios very closely. Since inception in 2011, the simulated Best Ideas Newsletter has averaged roughly a 25% cash position. We wrote up an extensive summary of the simulated Best Ideas … Read more