CALM

Dividends, Dividends, Dividends

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Valuentum’s President of Equity Research Brian Nelson shares three unique insights on dividends not commonly discussed among investors. The transcript of the video can be found in this article. Brian Nelson, CFA: This is Brian Nelson from Valuentum Securities. I wanted to share with you three insights on dividends that I don’t think are talked about enough in today’s dividend growth investing handbook. The first is the idea that the dividend is a symptom of a company’s strength so the key driver behind a firm’s valuation is its free cash flows, and the dividend is a symptom of the company being able to continue to generate those free cash flows and to pay a portion of those cash flows to … Read more

PepsiCo’s Pricing Actions Fantastic; Needs Better Free Cash Flow in 2023 to Cover 10% Dividend Hike

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Image Source: PepsiCo By Brian Nelson, CFA On February 9, PepsiCo, Inc. (PEP) reported impressive fourth-quarter 2022 results that showed organic revenue growth of 14.6% and core constant-currency earnings-per-share expansion of 10%. The company also added to its long streak of consecutive annual dividend increases, raising the payout by 10%, to $5.06 per share on an annualized basis, starting with the June 2023 payment. PepsiCo has rewarded dividend growth investors with 51 consecutive years of dividend growth, and we have no reason to believe that the streak will be broken anytime soon. The firm expects to buy back $1 billion worth of its shares during 2023. PepsiCo showcased tremendous product pricing power. During the fourth quarter, volumes across its portfolio … Read more

Consumers Feeling the Pinch; S&P 500 Bounces Off Technical Resistance; Elasticities Breaking Down for Staples Stocks

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By Brian Nelson, CFA Microsoft Corp. (MSFT) is the latest big tech company to announce big job cuts. The company that is still working to close its deal with Activision (ATVI) announced that it would slash 10,000 jobs, or about 4.5% of its workforce. The unemployment rate in the U.S. stands at just 3.5%, as recorded in December 2022, so even though we’re witnessing quite a number of layoffs in Silicon Valley, the labor markets are still very, very healthy. Those being laid off are finding jobs rather quickly, too. According to the WSJ, “about 79% of workers recently hired after a tech-company layoff or termination landed their new job within three months of starting their search.” Businesses have been … Read more

The Fed ‘Can’t Stop, Won’t Stop’ Until Labor Market Feels More Pain

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  Image: Prices for private label brands at Aldi are considerably lower than those of branded products. The consumer staples sector, however, remains fully-priced with a 21+ forward earnings multiple, and many constituents hold large net debt positions. We believe the sticking point for the Fed is not groceries or gasoline prices, but rather the labor markets, which remain very strong, despite layoffs. Image Source: Valuentum By Brian Nelson, CFA We’ve yet to see the worst of job cuts, in our view. The rapid shift in the global economy mid-2022 was profound, as many companies were still building in anticipation of increased demand during the first half of the year to the point where demand growth started to dry up, … Read more

Deere’s Incredible Pricing Power Shines Through in Fiscal Fourth Quarter

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Image: Deere put up excellent fiscal fourth-quarter results for the period ending October 30, 2022. The company’s pricing power is phenomenal. Image Source: Deere By Brian Nelson, CFA On November 23, Deere & Company (DE) reported results for its fourth quarter of fiscal 2022 for the period ending October 30, 2022. We pay close attention to Deere for insights across the industrial equipment and agricultural supply chain, and things are looking resilient, despite evident pressures across the consumer discretionary arena, as revealed by Target’s (TGT) holiday outlook. Shares of Deere have soared more than 26% year-to-date during 2022, and while we like the company, we think its equity price has run too far too fast. We like our existing ideas in … Read more

Something New!

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Hi everyone: To stay true to our mission, you’ll find something new regarding our methodology. In the coming weeks, you’ll see this table in our work going forward. We just wanted to let you know. We appreciate your membership very much!   ——————————————— About Our Name But how, you will ask, does one decide what [stocks are] “attractive”? Most analysts feel they must choose between two approaches customarily thought to be in opposition: “value” and “growth,”…We view that as fuzzy thinking…Growth is always a component of value [and] the very term “value investing” is redundant.                          — Warren Buffett, Berkshire Hathaway annual report, 1992 At Valuentum, we take Buffett’s thoughts one step further. We think the best opportunities arise from an understanding of … Read more

Announcing Valuentum’s Customer Appreciation Day Winners!

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In no particular order — the five winners… As a Chief Investment Strategist that oversees a significant amount of assets, it is vital to have unbiased research that we can lean on for decision making. Brian and the Valuentum team help provide a disciplined and fundamental approach to stock analysis without the typical Wall Street bias or conflicts of interest. The value we get on a monthly basis for having this detailed thought analysis and wise long-term thinking greatly outweighs the cost. We are very happy to have them on our short list of management we trust.  – Stephen H. (October 2022) —– I’d like you to know what my takeaways are from your research: 1) Be wary of capital … Read more

New Payment Option! Valuentum Research Update!

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Hi everyone: — We’re excited to say that we’re adding additional payment flexibility at Valuentum. — Many members have expressed interest in paying via other providers, and we have added Square to the mix. You can use credit or debit card or bank (ACH) to pay via invoice. — With all of the goings-on in the financial technology and payments space, we wanted to continue to provide members options to pay their memberships how they want and through who they want. You can always reach out to us at info@valuentum.com. — You’ll notice that we’ve also tightened our focus at Valuentum during the past 12-24 months in advance of what has certainly become a more difficult 2022 than even some … Read more

Dividend Increases/Decreases for the Week of September 30

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Below we provide a list of firms that raised their dividends during the week ending September 30. 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                BancFirst (BANF): now $0.40 per share quarterly dividend, was $0.36. Cal-Maine Foods (CALM): now $0.85 per share quarterly variable dividend, was $0.75. City Holding (CHCO): now $0.65 per share quarterly dividend, was $0.60. Corebridge Financial (CRBG): now $0.23 per share quarterly dividend. The First of Long Island (FLIC): now $0.21 per share quarterly dividend, was $0.20. First High-School Education Group (FHS): now $0.0146 per share … Read more

Fed Raises 75 Basis Points; Food Price Inflation Continues to Wreak Havoc on Consumer Budgets

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Image Source: Federal Reserve The Fed upped its key benchmark rate to the range of 3%-3.25% on September 21, but it may not be enough to stem the rise in inflation. We think the market has further room to fall. By Brian Nelson, CFA We think the Fed is looking to crush the economy and break the will of businesses to raise prices. Unfortunately, there is only so much that hiking the federal funds rate can do, and much of the inflation that is hurting the consumer is coming in the form of food prices, and this doesn’t look like it will abate anytime soon. I had warned about a coming market “flush” in a late August video, in part … Read more