Valuentum Exclusive Analysis for the Discerning Investor

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Mar 12, 2021

Oracle Beats Consensus Estimates and Raises Its Dividend By 33%
Image Source: Oracle Corporation – September 2019 Financial Analyst Meeting Presentation. On March 10, Oracle Corp reported third quarter earnings for fiscal 2021 (period ended February 28, 2021) that beat both consensus top- and bottom-line estimates. We include Oracle as an idea in the Dividend Growth Newsletter portfolio, and we are big fans of its impressive free cash flow generating abilities. The company’s Dividend Cushion ratio of 3.0 (a stellar ratio) earns Oracle an “EXCELLENT” Dividend Safety rating, and please note that these metrics incorporate our expectations that Oracle will push through meaningful payout increases over the coming fiscal years. We give Oracle an “EXCELLENT” Dividend Growth rating. In conjunction with its latest earnings report, Oracle boosted its quarterly dividend up to $0.32 per share, up 33% on a sequential basis. At the new payout level, shares of ORCL yield ~1.9% as of this writing. Management also recently increased Oracle’s share buyback authority by $20.0 billion. We continue to like exposure to Oracle in the Dividend Growth Newsletter portfolio and were impressed with the company’s latest earnings report and recent operational updates.

Mar 10, 2021

Dividend Growth Portfolio Idea Dick’s Sporting Goods Raises Dividend 16%!
Image Source: Mike Mozart. Dick's Sporting Goods put up its best same-store-sales growth rate in history during 2020. We continue to like shares of the sporting goods retailer in the Dividend Growth Newsletter portfolio. Dick’s Sporting Goods showcased the strength of its business model during 2020, and while it may not be able to duplicate the results in 2021, we think the future is bright. Free cash flow generation trends are solid, its balance sheet is healthy, and dividend coverage is sound. As more and more consumers choose healthier lifestyles, Dick’s Sporting Goods remains in a sweet spot to capture continued demand. With a solid 2% dividend yield, the company remains a holding in the simulated Dividend Growth Newsletter portfolio. We expect continued strong dividend growth for years to come.

Mar 5, 2021

Our Thoughts on Berkshire Hathaway’s Latest Annual Report
Image Shown: Shares of Berkshire Hathaway Inc Class B stock have been on an upward climb since June 2020 with room for additional capital appreciation upside. The top end of our fair value estimate range for BRK.B sits at $275 per share. We continue to like exposure to Berkshire Class B stock in our Best Ideas Newsletter portfolio. The top end of our fair value estimate range sits at $275 per share of BRK.B, indicating the company has room for additional capital appreciation upside as of this writing even after moving higher over the past several months. Just like any investor, Mr. Buffett will not always get it right, but we appreciate his candor when he gets something wrong. Bigger picture, the outlook for the US economy appears strong as public health authorities are utilizing COVID-19 vaccine distribution efforts to help bring an end to the crisis. Mr. Buffett, in his letter, was very upbeat about the US economy. We will end with this comment from the Oracle of Omaha: “Our unwavering conclusion: Never bet against America.”

Mar 1, 2021

Members Only: The March Edition of the Dividend Growth Newsletter Is Now Available

Feb 28, 2021

Earnings Roundup: BYND, DASH, DPZ, NVDA
Image Shown: Shares of DoorDash Inc tumbled after the food delivery service reported its latest earnings report near the end of February 2021. In this article, we've highlighted four companies that just reported their latest results. Domestic and international economic activities continued to face major headwinds from the coronavirus (‘COVID-19’) pandemic near the end of last year and into the beginning of this year, though corporates are now starting to plan for a world when “pre-pandemic” activities (such as going to eat indoors at a restaurant) can resume in earnest. Global health authorities are working to put an end to the public health crisis via ongoing COVID-19 vaccine distribution efforts. In alphabetical order by ticker: BYND, DASH, DPZ, NVDA.

Feb 26, 2021

The Invisible Hand Will Sink These Markets
Image: Nan Fry. Markets have bounced right off the high end of our fair value estimate range on the S&P 500, and we’ve raised cash. The violins are playing on the Titanic. The “unsinkable” ship we call the price discovery mechanism of the markets can sink. Let us not be fools to think otherwise. There will be an epilogue to Value Trap, and you and I both know that I don't want to write it. Let's keep playing the violin for now.

Feb 25, 2021

DermTech Revolutionizing the Cancer Detection Market
Image Source: DermTech Inc – Corporate IR Presentation for the first quarter of 2021. DermTech is an innovator in the skin cancer and skin cancer risk detection market. The company's DermTech Melanoma Test offering that is built on its Pigmented Lesion Assay (‘PLA’) test is cheaper, more effective, and more patient friendly than traditional skin cancer detection offerings. The total addressable market (‘TAM’) for the company’s currently approved PLA test--and PLAplus test if that offering receives regulatory approval--is estimated to stand at ~$2.5 billion (or more) in the US alone. In our view, there is room for DermTech to take a sizable chunk of that market, especially as the firm scales up its sales force. DermTech is one for the radar of capital appreciation seeking investors.

Feb 25, 2021

Realty Income’s Dividend Track Record Unfazed by Its Weakened Theater Exposure
Image Source: Realty Income. We include Realty Income, “The Monthly Dividend Company,” in the Dividend Growth Newsletter portfolio, and the company’s long-term dividend growth track record has been fantastic, posting 90+ consecutive quarterly dividend increases. Though the REIT is capital-market dependent, its investment-grade corporate debt ratings (A3/A-) support its ability to tap the debt and equity markets when needed, as it has been doing during this COVID-19 crisis. Shares of Realty Income yield ~4.5% at the time of this writing.

Feb 24, 2021

Garbage Hauler Republic Services Expects Record Year in 2021
Image Source: Republic Services. There are few things as certain as death and taxes, but garbage may be one of them. One of our favorite ideas within the municipal solid waste coverage is Republic Services, a holding in the Dividend Growth Newsletter portfolio. We love its free cash flow generating ability, visibility into future revenue, enviable position with respect to disposal capacity, CPI-based book of business, and exposure to fast-growing economic areas in the US.

Feb 24, 2021

Home Depot Shows the Home Has Never Been More Important
Image Source: Home Depot. On Tuesday, February 23, Home Depot reported fiscal fourth-quarter 2021 results (period ending January 31, 2021) that came in better than consensus estimates across the board. Not only did the top- and bottom- lines beat, but comparable store sales growth of 24.5% exceeded even some of the most optimistic forecasts for the home improvement retailer during the period. The average ticket price and the number of transactions advanced, while both professional (“Pro”) and Do-It-Yourself (“DIY”) customer revenue increased at a double-digit pace in the quarter. Home Depot also raised its dividend 10% and now yields ~2.5% on a forward-looking basis ($6.60 per-share dividend on an annualized basis). We continue to like the home improvement retailer as a holding in the Dividend Growth Newsletter portfolio.