Valuentum Exclusive Analysis for the Discerning Investor

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Jan 21, 2024

3 Substantial Benefits of Dividend Growth Investing
Image Source: www.epictop10.com. There are three primary benefits of a well-executed dividend growth strategy, one that is carried out with prudence and care and one that pays careful attention to the intrinsic value of the stock and its critical cash-based components. Albert Einstein is reported to have called compound interest the "eighth wonder of the world," but dividend growth investing has the potential to offer long-term investors so much more! Let's explain.

Jan 8, 2024

Thinking Slow: 3 Research Blind Spots That Changed the Investment World
Image Source: EpicTop10.com. We have to be on high alert about how our minds work. PBS recently delivered a four-part series examining how easily our minds are being hacked, and why it is so important to "think slow." When it comes to the active versus passive debate, does the analysis suffer from parameter risk? With respect to empirical, evidence-based analysis, does the analysis have the entire construct wrong? When it comes to short-cut multiples, are we falling into the behavioral trap of thinking on autopilot?

Dec 29, 2023

Kinder Morgan’s ~6.4% Dividend Yield Is Much Stronger These Days
Image: Kinder Morgan is back on track. Image Source: Kinder Morgan. Early in December, Kinder Morgan released financial expectations for 2024 that showed the midstream energy giant is back on track. Excluding its recent purchase of NextEra Energy Partners’ STX Midstream assets, Kinder Morgan expects 5% expansion in adjusted EBITDA and distributable cash flow [DCF] in 2024 thanks to growth in its Natural Gas Pipelines and Energy Transition Ventures segments coupled with rate escalations across its operations. For 2024, management is targeting its 7th consecutive year of dividend increases with a projected annualized dividend of $1.15 in 2024. Net debt-to-Adjusted EBITDA is targeted at 3.8x at the end of 2024, a level that is materially lower than its long-term target of 4.5x. We're liking the continued improvements at Kinder Morgan in recent years.

Dec 23, 2023

12 Reasons to Stay Aggressive in 2024
From outperforming simulated newsletter portfolios to fantastic success rates in the Exclusive publication to option ideas and great income-oriented ideas and beyond, we continue to deliver across our simulated newsletter suite as our latest video outlines. It’s hard to know exactly what 2024 will bring in terms of a market return, but the internals of the stock market and the U.S. economy look great to us. The new bull market we’re in could last for years, and as a result, we are staying aggressive with many of our new ideas as we look to benefit from these favorable trends.

Dec 16, 2023

ICYMI -- Video: Our Top Stocks for 2024
Valuentum's President of Investment Research Brian Nelson walks through the success of Valuentum's newsletter suite, the state of the economy and markets, and offers his favorite idea for each sector. Tune into this must-watch video.

Oct 3, 2023

We Like NextEra Energy’s ESG Focus But Capital Market Conditions Now Showing Cracks
Image Source: NextEra Energy. NextEra Energy operates a complex business structure, and the firm’s equity is facing pressure on news that its subsidiary NextEra Energy Partners is cutting its distribution per unit growth rate to the range of 5%-8% annually through 2026, which is materially below its prior expectations of growth in the 12%-15%. Since most partnerships are owned primarily for their distribution yields, the revision has sent units of NextEra Energy Partners tumbling, hurting its partner along the way. The news, while not tragic, wasn't very welcoming, and reading between the lines, it appears that we’re starting to see some cracks in the capital markets, as most partnerships are debt-heavy, relying on continuous, affordable access to the capital markets to fund and grow their operations (distributions), which isn’t guaranteed.

Oct 3, 2023

Big Cap Tech and Large Cap Growth Remain Safe Havens
Image: The stylistic area of large cap growth, which is heavily represented in the Best Ideas Newsletter portfolio, is doing fantastic so far in 2023. Brian here. I wanted to write this brief note to check in with you as the market continues to be a bit jittery following the highs it reached in late July. The Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio put up a great year of relative outperformance during 2022 versus the market-cap weighted S&P 500, and their exposure to the areas of big cap tech and large cap growth have helped them follow through during 2023. It’s easy to fall into the trap of relying just on valuation multiples and dividend yields, but we have to continue to emphasize that it is our view that enterprise valuation is the key determinant of equity prices and returns, and it should not be surprising that big cap tech and large cap growth, with their huge net cash positions and strong expected free cash flows, have dominated returns so far in 2023.

Sep 20, 2023

ICYMI: Questions for Valuentum’s Brian Nelson
Valuentum's President Brian Nelson, CFA, answers your questions.

Aug 5, 2023

ICYMI -- Shocking?!?! Utility Dividends Aren’t Always Safe
Image Source: Oran V. There is plenty to like about the business models of utilities. Regulated utilities, for one, are monopolies in their operating regions, providing an essential service to businesses and customers. This, coupled with the fact that the returns of regulated utilities are set by a regulatory body within a defined ratemaking process, causes the sector to be full of operators that boast steadily-growing earnings that appear to be materially dependable. As we note in this article, however, a surprisingly large number of utilities in our coverage universe have cut their dividends in the past. Are the dividends of utilities as safe as many make them out to be? Let’s dig in.

Jul 11, 2023

NextEra Energy Expects 10% Annual Dividend Growth
Image Source: Nextera Energy. We think the utility sector is generally overrepresented in many dividend-oriented and income-producing portfolios, but we think NextEra Energy is a good fit for the well-diversified ESG Newsletter portfolio given its vast renewable resource assets. Shares of Nextera Energy have fallen more than 20% since the beginning of 2022, while the Utilities Select Sector SPDR Fund ETF is down more than 8% over the same time period. Shares of Nextera Energy yield ~2.6%.