BBY

Valuentum Economic Castleâ„¢ Rating Update

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Read: Keeping the Horse Before the Cart: Valuentum’s Economic Castle™ Rating The Economic Castle Focuses on the Magnitude of Economic Value Creation The Valuentum Economic Castle™ rating is an enhancement of the competitive advantage framework (commonly known as economic moat analysis) that has become widespread and ubiquitous within the investing world. Whereas an economic moat framework evaluates a firm on the basis of the sustainability and durability of its competitive advantages, Valuentum’s Economic Castle™ rating evaluates a firm on the basis of the firm’s future economic profit spread (return on invested capital less its weighted average cost of capital). The companies with the strongest Valuentum Economic Castle™ ratings are poised to generate the most economic value for shareholders in the … Read more

Dividend Increases for the Week Ending June 13

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Below we provide a list of firms that raised their dividends during the week ending June 13. The dividend reports of covered firms on this list will be updated shortly with the new information. To access our dividend reports use the ‘Symbol’ search box in our website header. Firms Raising Their Dividends This Week Baytex Energy (BTE): now C$0.24 per share monthly dividend, was C$0.22. Best Buy (BBY): now $0.19 per share quarterly dividend, was $0.17. Caterpillar (CAT): now $0.70 per share quarterly dividend, was $0.60. Cherry Hill Mortgage Investment (CHMI): now $0.51 per share quarterly dividend, was $0.50. Essex Property Trust (ESS): now $1.30 per share quarterly dividend, was $1.21. FedEx (FDX): now $0.20 per share quarterly dividend, was … Read more

The Twilight Zone: JC Penney and Best Buy Report Better-Than-Feared Performance

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Shares of JC Penney (JCP) and Best Buy (BBY) are currently engaging in a classic “dead cat bounce” with the equity prices of both firms experiencing modest appreciation after reporting their respective fourth-quarter results recently. JC Penney is trading just over $7 per share, down from about $70 per share in 2007, while Best Buy is hovering at about $27 per share, down from more than $40 per share, a level achieved only a few months ago. We continue to believe both companies are far from healthy. What’s the news that has JC Penney’s shares spiking to $7 and change? The firm reported a loss per share of $0.68 in its fourth-quarter report, released February 26, beating estimates that had … Read more

Household Durables Firms, Electronics Retailers Face Pressure

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On Monday, the maker of the Sleep Number bed, Select Comfort (SCSS) sent shudders through the furniture and bedding manufacturing industry when it warned that not only would fourth-quarter sales miss the mark but that the challenging times would continue into 2014: Select Comfort Corp…reported that preliminary fourth-quarter 2013 total net sales grew 5% year-over-year to $231 million, with flat company-controlled comparable sales growth. The mid-point of the company’s fourth-quarter EPS guidance range of $0.18 to $0.26 assumed low-double-digit growth in total net sales and mid-single-digit growth in company-controlled comparable sales. Through November, company performance was trending consistent with the EPS guidance range, with solid sales results and expense controls. From Cyber Monday through the end of December, however, sales … Read more

Three Reasons Why Dividend Growth Investors Are Quite Savvy

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A version of this article appeared on our website on October 1, 2013. There are many different approaches to investing, but we think dividend growth investors are quite savvy, especially when they combine a rigorous dividend growth process in the form of the Valuentum Dividend Cushion ratio with the valuation rigors behind the Valuentum Buying Index. Let’s examine the three reasons why we think dividend growth investors are a smart group in the age of ultra-low interest rates. #1. Fool Me Once, Shame on You…Fool Me Twice, Shame on Me Today’s dividend growth crowd has seen enough. First, they witnessed the dot-com bubble (1997-2000), a period in stock market history where firms’ stock prices soared in some cases as a result … Read more

Great Early Holiday Sales Read for Best Ideas Portfolio Holdings

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On Saturday, IBM Digital Analytics Benchmark, a source for real-time cloud-based online retail data and analysis, revealed strong online retail trends for this Thanksgiving and Black Friday: US Holiday shoppers once again shopped online early for the best deals with Thanksgiving Day online sales increasing by 19.7 percent over 2012. This momentum set the stage for a record Black Friday, with online sales growing 18.9 percent over the same period last year. The biggest surge came from mobile sales increasing to 25.8 percent of total online sales for Thanksgiving and 21.8 percent for Black Friday as consumers went from the dinner table to their tablets to lock in the best offers. In addition, IBM reported that New York City consumers … Read more

E-commerce Exposure Still Makes Sense

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The Census Bureau of the Department of Commerce reported Friday that it estimates US retail e-commerce sales for the third quarter, adjusted for seasonal variation, came in at 17.5% (+/- 5.8%) versus the same period a year ago. On an adjusted basis, US retail e-commerce sales, as a percent of total quarterly retail sales, have advanced to nearly 6%, up from just 2% at the beginning of 2004 (shown in image below). Both the rapid pace of US retail e-commerce sales expansion and the trend toward more transactions being completed online show no signs of slowing. Image Source: US Department of Commerce The positive data follows comScore’s (SCOR) report, released earlier this month, of a 13% increase in US desktop-based … Read more

Best Buy Tumbles Back to Our Fair Value Estimate

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On Tuesday, Best Buy (BBY) reported decent third-quarter results considering the intense competition from both brick-and-mortar locations and online powerhouses. Revenue was essentially flat from the same period a year ago, as comparable store sales of 0.3% improved substantially from the year-ago period’s 5.1% decline (see image below). Leading the charge in the quarter was Best Buy’s online presence, where same-store sales advanced 15.1% in the quarter, accelerating from the 10.3% pace set in the third quarter of last fiscal year. Increased traffic, a higher average order value, and a higher number of online orders being placed in retail stores benefited domestic online revenue. The rate of the company’s international comparable same-store sales decline slowed to 6.4% from more than … Read more

Jana Bets Big on Outerwall

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Great investors are often a wonderful source of investment ideas and opportunities—imagine capitalizing on a great Buffett idea like Coca-Cola (click ticker for report: ) in the late 1980’s. However, blindly following an elite investor can have disastrous consequences—think following Bill Ackman into J.C. Penney (click ticker for report: ). Valuentum helps you sort out the good ideas from the bad. Still, when an investor with a superb track record takes a sizable stake in a troubled company, we tend to pay attention. Barry Rosenstein’s Jana Partners has trounced the S&P 500 since its inception, achieving annual compounded returns of 12.7% versus 1.7% for the S&P 500 over the same time frame. Jana is known as an activist shareholder that … Read more

Shares of GameStop Look Expensive Even with Strong Guidance

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Retailer GameStop (click ticker for report: ) posted a steep decline in second quarter results that was overshadowed by a positive outlook for the back half of the year. Revenue fell 10.7% year-over-year to $10.4 billion, which was a bit better than consensus expectations. Earnings per share dropped 44% year-over-year to $0.09, which was also better than consensus estimates. Sales have been weak… Image Source: Valuentum, Company Filings Shares of GameStop are up 177% over the past year—a phenomenal increase given the steep same-store sales declines recently (shown above). Weakness didn’t moderate much in the second quarter, with same-store sales dropping 10.7% year-over-year. Of course, the rally in GameStop’s share price has little to do with what happened in fiscal … Read more