Valuentum Exclusive Analysis for the Discerning Investor

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Aug 27, 2020

Dick’s Sporting Goods Finds E-Commerce Success
Image Shown: Shares of Dick’s Sporting Goods Inc rallied by ~16% during normal trading hours on August 26 after reporting stellar same-store sales growth.  On August 26, Dick’s Sporting Goods reported second quarter fiscal 2020 earnings (period ended August 1, 2020) that beat consensus estimates on both the top- and bottom-lines. Driving this outperformance was Dick’s Sporting Goods’ 20.7% year-over-year increase in same-store sales as its e-commerce sales rose by 194%, which includes sales conducted through its curbside contactless pickup option. E-commerce sales represented ~30% of the sporting goods retailer’s total sales last fiscal quarter. Average ticket sizes and the number of transactions both grew last fiscal quarter according to management commentary included in the earnings press release. Shares of DKS shot up by almost 16% after the report was published during normal trading hours on August 26. As of this writing, shares of DKS are trading near the upper bound of our fair value estimate range (which sits at $56 per share). That means shares of Dick’s Sporting Goods appear fairly valued at the moment, and we like its strong e-commerce performance and improving outlook. After reinitiating its quarterly dividend program this past June, shares of DKS yield 2.3% on a forward-looking basis (with an annualized payout of $1.25 per share of its common stock). We will cover its financial strength and dividend policy in greater detail in this note.

Jul 6, 2020

Lululemon Athletica Buys MIRROR
Image Source: Lululemon Athletica Inc – First Quarter Fiscal 2020 Quarterly Financial Supplements. On June 29, Lululemon Athletica announced it was acquiring home fitness company MIRROR for $500 million in cash. MIRROR sells ~$1,500 (before taxes and installation fees) screens that come with a camera and speaker system that allow users to participate in at-home workouts assisted by trainers/videos. That offering comes with a $39 per month digital subscription which allows the user (or users, up to six people per household) to access on-demand and live workout sessions, and additionally, personal training sessions cost up to $40 each.

Jun 21, 2020

Warren: Four Ways to Play the Market at This Juncture
Image Source: Daniel Lobo. In this piece, we examine where the economy and stock markets have been recently, where we are now, and where we are going next. We also highlight four key ways to play this volatile market. We think this is a helpful way to think about overall portfolio construction, especially so that one does not overly expose themselves to a particular set of risks that could come to fruition—like an extended downturn in the economy or a rapid discovery of a vaccine for Covid-19 on the other hand.

Apr 7, 2020

24 in a Row! Order the Exclusive Today!
Image Source: An excerpt from the March 2020 edition of the Exclusive publication. Valuentum offers commentary across the capital stack in the Exclusive publication. In the Exclusive publication, Valuentum highlights three new ideas each month to consider, one for income, one for capital appreciation, and a "short" idea (all three outside our existing coverage universe). Through March 2020, the success rate for capital appreciation ideas is 84%+ and an incredible 95%+ for short-idea considerations. As of this writing, the Exclusive is currently on a short-idea win streak of 24 in a row! Make sure the Exclusive is part of your Valuentum membership.

Feb 13, 2020

What is Risk?
Image Source: Mike Cohen. Let’s start by talking about what isn’t risk. Risk isn’t easily measured, and yet that is what the asset management industry and academia tend to serve up to the average and professional investor alike. You will see the standard deviation of a stock or portfolio, showing how much the value wiggles. You will see beta, which shows how much the value wiggles as compared to the benchmark’s own wiggles. You will see things like the Sharpe and Sortino ratios, which tackle further quantifiable ways to describe risk--and the list of equations goes on and on. Do you know what is a much more difficult question for an asset manager to answer? How much real risk is contained in your portfolio? I was going to say fundamental risk, but real risk is a broader category and what I am driving at in this piece. So, let’s get after it. What is real risk as it pertains to an individual investment or a portfolio?

Nov 27, 2019

Order the Exclusive: Get Unbiased Research on IPOs and More!
Image Source: The October edition of the Exclusive publication. Valuentum offers unbiased commentary on IPOs in its Exclusive publication (e.g. Peloton, Cloudflare).In the Exclusive publication, Valuentum highlights three new ideas each month to consider, one for income, one for capital appreciation, and a "short" idea (all three outside our existing coverage universe). Fresh, underfollowed and new ideas -- outside our coverage universe -- every month! Nothing is held back. We provide insights where others cannot, and the IPO market is just one area (e.g. Peloton, Cloudflare).