Valuentum Exclusive Analysis for the Discerning Investor

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Jun 14, 2024

Latest Report Updates
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Jun 10, 2024

Update: Frequently Asked Questions About Valuentum Securities, Inc.
Valuentum (val∙u∙n∙tum) [val-yoo-en-tuh-m] Securities Inc. is an independent investment research publisher, offering premium equity reports and dividend reports, as well as commentary across all sectors/companies, a Best Ideas Newsletter (spanning market caps, asset classes), a Dividend Growth Newsletter, modeling tools/products, and more. Independence and integrity remain our core, and we strive to be a champion of the investor. Valuentum is based in the Chicagoland area. Valuentum is not a money manager, broker, or financial advisor. Valuentum is a publisher of financial information. We address a number of questions from both subscribers and visitors to our site.

Apr 30, 2024

Enterprise Products Offers Investors Key Midstream Exposure
Image: Enterprise Products Partners has come back nicely since the doldrums of the COVID-19 meltdown. We’ve never been huge fans of pipeline master limited partnerships [MLPs], but Enterprise Products Partners has been executing well. We also like the transparency it provides with respect to adjusted cash flow from operations and adjusted free cash flow, the latter coming in at $1.08 billion for the three months ended March 31. Units yield ~7.2% at the time of this writing and remain key exposure to the midstream space within the High Yield Dividend Newsletter portfolio.

Mar 29, 2024

Latest Report Updates
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Feb 4, 2024

Earnings Roundup: MO, EPD, SBUX, CLX, HON
Image: Starbucks’ international store growth potential remains robust. Image Source: Starbucks. High-yielding tobacco giant Altria offered an outlook through 2028 that spoke to continued robust earnings and dividend-per-share expansion. Enterprise Products Partners, now a Dividend Aristocrat, is handling record volumes through its pipeline network, and the firm is investing heavily to drive improved long-term cash flow trends. Starbucks recently disappointed on a number of metrics, but the company's margin and earnings performance remains excellent, as is its international store growth opportunities. Clorox has recovered nicely from a recent cyberattack, and the firm is now forecasting adjusted earnings per share growth in fiscal 2024. We're monitoring its cash flow trends closely, however. Honeywell is targeting tremendous free cash flow growth in 2024 thanks to continued strength in its commercial aerospace operations.

Jan 12, 2024

Dividend Increases/Decreases for the Week of January 12
Let's take a look at firms raising/lowering their dividends this week.

Dec 29, 2023

Latest Report Updates
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Dec 27, 2023

Dividend Aristocrat Enterprise Products Partners Boasts 7%+ Yield, Investment-Grade Marks
Image: Enterprise Products Partners continues to raise its distribution year after year. Source: Enterprise Products Partners. Though, in general, we’re not too excited by the midstream pipeline space given their capital-intensive nature and hefty net debt positions, Enterprise Products Partners has a lot of things going for it. The company boasts investment-grade credit ratings (A-/A-/A3), has strong and consistent returns on invested capital, and has put up 25 years of consecutive distribution increases. In addition to growing its payout in each year for more than two decades, management has done a great job reducing its leverage ratio (net debt adjusted for equity credit in its junior subordinated notes divided by adjusted EBITDA). For the trailing twelve months ended in the third quarter, its leverage ratio has fallen to 3.0x from 4.1x in 2017. All told, we think Enterprise Products Partners’ growth initiatives will help to solve revenue pressures, and we expect the company to continue to drive distribution growth in the coming years as it keeps its leverage in check.

Dec 1, 2023

A Note on Valuation -- Low P/E Stocks with High Dividend Yields
Image: Stocks with low valuation multiples have trailed the broader S&P 500 (orange) considerably since the depths of the Great Financial Crisis. Today, with all the readily available information and data out there, it is far more likely the case that a company with a low P/E ratio actually deserves it, and a firm with an outsized dividend yield just holds a lot of net debt on their books. Investing in low P/E stocks or stocks with low valuation multiples without considering their intrinsic values (i.e. fair value estimates) may result in owning a basket of value traps. Investors may be attracted to these types of stocks for their low P/E ratios and hefty dividend yields, but just having a low P/E ratio and a high dividend yield doesn’t a good stock make. If investing were this easy, so-called “value stocks” wouldn’t have underperformed the market significantly for more than a decade and a half now.

Oct 23, 2023

Kinder Morgan Now Covers Cash Dividends with Traditional Free Cash Flow
On October 18, Kinder Morgan reported third-quarter results that came in lower than expectations, but we’ve taken note of the company’s improved free cash flow generation that now runs in excess of its cash dividends paid, a huge change from a decade ago, where capital spending and cash dividends paid far outweighed its operating cash flow capacity. The company’s dividend stands at $1.13 per share on an annualized basis, and Kinder Morgan now has an forward estimated dividend yield of ~6.7%, which is quite attractive. Shares are trading meaningfully below our estimate of their intrinsic value, too, and we’re warming up to the company’s financials. Its net debt position likely precludes it from being added to any simulated newsletter portfolio at this time, however. Our $21 per-share fair value estimate remains unchanged.