Valuentum Exclusive Analysis for the Discerning Investor

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Dec 8, 2015

Dividends Not Safe as Energy Markets Swoon
We continue to monitor the carnage in the oil and gas markets, and we encourage readers to evaluate each firm’s unadjusted Dividend Cushion ratio to assess capital-market dependency. For most midstream entities and upstream entities that remain inescapably tied capital cycle builds, the risks are extreme.

Nov 3, 2015

US Oil Majors
Lower price realizations for major oil producers continue to pressure financial results. Though refining and chemical margins have improved, big oil exploration and production remains under significant pressure.

Oct 6, 2015

Transaction Alerts: Moving Closer to Market Neutral on Energy
The absence of energy exposure in the Best Ideas Newsletter portfolio for much of the slide in the price of crude oil has been a tremendous source of upside. The elimination of several profitable positions in the Dividend Growth Newsletter portfolio several months ago has added to significant outperformance there. But now…we’re inching back into energy, if ever so slightly and on a highly diversified basis.

Oct 5, 2015

Standard & Poor’s Notes Heightened Default Risks
The markets knew this was coming, but we think it’s worth repeating. How we’re playing the bounce in energy stocks…

Sep 24, 2015

China, Petrobras and the Circling Sharks
A key gauge of manufacturing activity in China plummets to Financial Crisis lows, Brazil’s Petrobras may be the first major casualty of the country’s deepening recession, and lenders are beginning to tighten the noose on overleveraged commodity producers in America.

Sep 15, 2015

As the World Turns
We’re keeping our eyes on a number of things. First, we’re monitoring property prices in Shanghai and in other larger Chinese cities to assess the potential calamity that falling housing prices and deflation would have on the country’s banking sector and the likelihood of contagion via the British banks, HSBC and Standard Chartered, and the US ones, namely Citigroup and JP Morgan. Second, we’re watching the price of crude oil closely, as its fall will have huge implications on the earnings trajectory of companies that benefit (airlines, restaurants) as well as the ones that suffer (upstream and energy services). The net effect of falling crude oil prices has thus far been negative for S&P 500 earnings, but this may change as the energy sector becomes an ever-smaller part of index construction. Third, who can forget about the Fed, the expected duration of any tightening monetary cycle, and the resulting implications on dividend-paying stocks as Treasury yields rise?

Sep 2, 2015

Extreme Volatility in Crude Oil Prices Continues
Saudi Arabia remains undeterred, China weakness spreads, and EIA inventories suggest we’re still awash in crude.

Sep 1, 2015

Batten Down the Hatches – Another US Market Crash Probable
The aftermath of China’s equity market collapse and the Dow’s crash last week will have material spillover effects.

Aug 28, 2015

3 Observations
The wild week that ended August 28, 2015.

Aug 26, 2015

The Damage Has Already Been Done
Nearly $5 trillion in wealth has been wiped clean from the Chinese markets since mid-June. Roughly $2 trillion has evaporated from US markets in just the past couple weeks. Repercussions will eventually be felt across the world economy, if consumers and businesses aren’t already scaling back.