Valuentum Exclusive Analysis for the Discerning Investor

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Nov 3, 2020

We’re Reiterating Our $200 Fair Value Estimate for PayPal
Image Shown: Short-term headwinds aside, PayPal’s latest earnings report reinforced our optimistic view on its long-term growth outlook which in turn is why we are maintaining our fair value estimate of $200 per share. We continue to be big fans of PayPal. The company has a pristine balance sheet, high quality cash flow profile, impressive growth outlook, and is trading well below its fair value estimate as of this writing. Though investors initially sold off shares of PYPL following its third-quarter report November 2 due to its expected growth trajectory slowing down in the near term, we're reiterating our fair value estimate of $200 per share as PayPal continues to deliver impressive fundamental performance. PayPal’s medium- and long-term growth outlooks remain stellar. Venmo could be a source of significant upside in the medium-term, and we are monitoring events closely.

Oct 22, 2020

Overweighting Outperformers
Image: The performance of ideas in the Best Ideas Newsletter portfolio during the trading session October 21. Many of the higher-weighted ideas in the newsletter portfolio are propelling the portfolio to relative outperformance. The Best Ideas Newsletter portfolio comprises a portfolio constructed of Valuentum's best ideas. These are companies that have scored favorably on the Valuentum Buying Index (VBI) and have been included in the newsletter portfolio with consideration of sector diversification and market/economic risk. The Best Ideas Newsletter portfolio is found in the Best Ideas Newsletter, which is released on the 15th of each month. Source: Seeking Alpha.

Sep 16, 2019

Economic Roundtable: Quant Quake, “Quac-cidental Correlation,” and Economic Moats
Image Source: Anders Sandberg. Last week, the markets may have revealed that internals aren’t all that healthy. Major equity markets experienced a “rotation” that reminded many investors of the “quant quake” from August 2007. As Valuentum’s Brian Nelson wrote in Value Trap, “just a few bad days in the market caused a rapid unwinding of many quant long-short strategies (back then). Goldman’s chief financial officer said at the time that the firm was witnessing ‘25-standard deviation moves, several days in a row.’” On the surface, markets last week seemed relatively calm, but as the episode in 2007 revealed the activity last week may just be the calm before the storm. Many are pointing to overcrowded trades in betting against certain factors, while others are saying that many were forced to deleverage. We’re not so sure, and we think it may be the opposite: after years of suffering from lagging “value” returns, we think several quant shops stepped in to take on leverage, betting on a return to “value.” Let's talk about last week's quant quake, spurious correlations (the “guac-cidental correlation, in fact), economic moats and much more.

Aug 22, 2019

What’s on the Valuentum Team’s Mind?
Let’s get the Valuentum team’s thoughts on recent developments.

Jul 17, 2019

In the News: Second-Quarter Earnings Season Begins
Second-quarter earnings season is upon us. The markets aren’t expecting much growth. Core industrial names may not fare well, but thus far, big pharma is solid. We’re not making any changes to the newsletter portfolios.

Jun 19, 2019

Facebook, Others Enter Crypto
Image: Facebook's new cryptocurrency. Source: Facebook.  We think Facebook’s new cryptocurrency Libra is a game changer. The company remains an idea in the Best Ideas Newsletter portfolio. We're reiterating our fair value estimates for "Founding Members" of the Libra Association at this time.

Jan 9, 2019

We Still Like PayPal
Image shown: PayPal has absolutely trounced the market since we retained it in the simulated Best Ideas Newsletter portfolio after its split from eBay. Simulated Best Ideas Newsletter portfolio idea PayPal has trounced the market by more than 100 percentage points since it split from eBay in July 2015. We continue to like shares.

Aug 17, 2018

ICYMI -- Podcast: 2nd Annual Nelson Exclusive Yearly Round Up Call
President of Investment Research at Valuentum Brian Nelson talks the markets, valuations, the economy, the consumer and various other trends from crude oil to cryptocurrency to geopolitical risks to corporate tax reform and beyond. Running time ~25 minutes.

Aug 14, 2018

The Inflating Index Fund Bubble
Image Source: Mac.Else von Berlin. The investment industry is changing fast, and we’re happy to be an instrument for change. We’ve been clamoring to make index funds free for a long time, and we’re glad to see it finally happen. Let’s cover the implications of indiscriminate buying regardless of price with the observation that the number of publicly-traded companies is vastly shrinking. How long will the inflating index fund bubble last?

Jun 21, 2018

PayPal Hits New Highs!
We continue to watch PayPal as it has been a fantastic idea in the simulated Best Ideas Newsletter portfolio since it split from eBay. Rivalries are intensifying in the digital payments space and the company will have to replace lost business with eBay in coming years, but we still like the idea. We also view Bitcoin and other cryptocurrencies as more an opportunity than a threat for many digital payment providers.