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Recent Articles
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In the News: McDonald’s, Costco, Target
Sep 27, 2023
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The market is once again worried about a potential government shutdown in the U.S., beginning on Sunday, as Congress works on a budget for fiscal 2024 through the rest of September. This recurring news has been a seasonal part of the market’s jitters every few years or so, however, and we’re not worried about what we would describe as an overhyped risk. A potential government shutdown in the U.S., if it happens, will inevitably be resolved, and while it tends to make for scary media headlines, it just doesn’t factor into the thesis of long-term investors. We don’t think readers should overreact.
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Report Updates: Amazon Registers the Lowest Rating on Our Scale
Sep 24, 2023
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Check out the latest report updates on the website. The biggest takeaway of this refresh is that Amazon is poised to generate significantly negative free cash flow in 2023, and while we think the firm will turn this measure around materially in the long haul, shares are coming out as overvalued on our discounted cash-flow process, while technically its stock price is breaking down. An overvalued stock on both an absolute and relative value basis with negative technical/momentum indicators registers the worst rating on our methodology, the Valuentum Buying Index (1=worst, 10-best).
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Dividend Increases/Decreases for the Week of September 22
Sep 22, 2023
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Let's take a look at firms raising/lowering their dividends this week.
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Cisco Buys Splunk
Sep 21, 2023
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Image Source: Brandon Leon.
Dividend Growth Newsletter portfolio holding Cisco is all about growing its recurring revenue base these days, and its announcement that it will buy Splunk on September 21 will not only help in a big way towards that goal, but the deal will also position Cisco for tremendous opportunities in the booming market that has become artificial intelligence [AI]. That said, some investors were not fans of the purchase price – some $28 billion in cash – but we think the price is fair and strategically, there’s nothing wrong with adding to the fold an asset-light, recurring-revenue business that has the foundation to be a key long-term player in AI. We’ll be taking a close look at our valuation model on Cisco as we further digest this proposed transaction, but for now, we’re comfortable with our $53 per-share fair value estimate of the networking giant.
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