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Fair Value Estimate Changes: Facebook, Twitter, Caterpillar and More…

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  By Kris Rosemann and Brian Nelson, CFA Let’s begin this edition of Recent Material Fair Value Estimate Changes’ with a discussion of some of the highest-profile names that made the list. If you require background reading on why we make changes to our valuation models, please see: What causes fair value estimates to change? Best Ideas Newsletter portfolio holding Facebook (FB) continues to separate itself from other social media companies, and we continue to be impressed by its free cash flow generating prowess and net cash-rich balance sheet. Our most recent fair value estimate increase comes largely as a result of greater optimism regarding the sustainability of the company’s pace of revenue growth, reflected by a hike in our mid-cycle … Read more

Commodity Price Pressures Dinging Industrial Bellwether Expectations

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By Kris Rosemann Commodity resource prices, while suppressed, are said to be stabilizing, but stabilization at low levels does little good for many operators tied to commodity-based end markets. Such is the case for several industrial giants General Electric (GE), 3M (MMM), and Caterpillar (CAT), all of which have seen their worldwide operations impacted by the effect that a prolonged trough in commodity prices has had on global economic growth, “Industrial Bellwethers Hit by Global Economic Growth Concerns.” We recently highlighted the organic growth pressures industrial bellwether Honeywell (HON) has been experiencing, “Honeywell’s Stock Up 170% Since End of 2009; GE a Better Bet?” and its peers have been echoing its concerns. GE reported third-quarter earnings October 21, and while … Read more

EVERYTHING DIVIDENDS + 3 TOP IDEAS

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The Valuentum analyst team explains the difference between the adjusted Dividend Cushion ratio and its unadjusted counterpart. The success of the Dividend Growth Newsletter portfolio is covered, and Valuentum’s top 3 dividend growth ideas are unveiled. ~13 minutes. If you are unable to view the video below, please select the link here or view the transcript below. Kris Rosemann: Hello and welcome to the Valuentum Securities podcast. My name is Kris Rosemann and with me today is Chris Araos and Brian Nelson, the president of equity research and ETF analysis here at Valuentum, and today we’re going to be discussing the Dividend Cushion ratio, the Dividend Growth Newsletter portfolio, and some of our favorite dividend ideas on the market today. So … Read more

Video: An Overview of Our 16-page Stock Research Reports

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Can’t view the video walk-through of our 16-page reports on your mobile device? Download the Puffin Web Browser App from Apple free. Click here. Unable to display content. Adobe Flash is required.

Understanding the Chartered Financial Analyst (CFA) Designation

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“Among the countless finance degrees around the world, the Chartered Financial Analyst qualification has become the gold standard.” – Financial Times, 13 August 2010 “[The] qualification is roughly equivalent to a specialized postgraduate finance degree, including a mixture of economics, ethics, law, and accountancy… Whereas there are tens of thousands of finance degrees available around the world, ranging from the excellent to the worthless, there is only one CFA, managed and examined by an American association of financial professionals, the CFA Institute.” – the Economist From the CFA Institute: “The Chartered Financial Analyst (CFA) charter is an investment credential that, for more than 60 years, has been the global standard for embodying the integrity, dedication, and advanced skills needed to … Read more

The Bounce in Energy and Potash’s “Surprising” Dividend Cut

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Nothing like Valuentum’s optimistic article last week, January 21, in Barron’s to get the energy markets popping, “Is Kinder Morgan on Road to Recovery,” would you say? Of course, we say that in jest. The equity markets January 28 were defined by optimism that two of the globe’s major energy resource producers, the cartel OPEC and Russia (RSX), would finally come together to alleviate the pain that has been exerted on the price of the black liquid the past 12-24 months with a “meeting.” What we found to be peculiar, however, is that instead of OPEC letting what turned into a “rumor” run, helping to further drive crude oil prices higher, OPEC delegates quickly denied the talk of a potential … Read more

What’s Working in Today’s Market?

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By Brian Nelson, CFA As emerging markets around the world suffer from commodity-price-led economic weakness, capital continues to find a safe-haven in US government bonds (TLT, TBT), but for those equity-oriented funds that mandate a fully-invested status, not something we’re particularly advocates of, assets within US equities have favored “lower-beta” utilities (XLU) and consumer staples (XLP) sectors while cyclically-dependent and credit-levered sectors such as the financials (XLF) and materials (XLB) have suffered thus far in 2016. The industrials (XLI) and energy (XLE) sectors have also encountered higher-than-normal selling pressure in the first few weeks of the New Year, as investors evaluate the global economic landscape and what a prolonged period of low energy prices may mean for the lowest quality … Read more

ICYMI: 5 Concerns About Impending Rate Hikes

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The first Fed rate hike in nearly a decade came and went December 16, putting an environment of ZIRP (zero interest rate policy) to an end, a policy that grew out of the Financial Crisis and the depths of the Great Recession late last decade. The Fed had paused plans to hike the federal funds rate for much of 2015 as a result, in our view, of getting a more informed read on the potential implications of emerging market developments–namely dislocations in the local Chinese equity markets (FXI) and recessionary conditions in Brazil (EWZ)–and the stock market crash (SPY) in the US in August that sent equities of some of the most well-known stocks including Apple (AAPL) and General Electric … Read more

Seeking to De-risk the Newsletter Portfolios

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There’s never a good reason to panic in investing, but the 276-point slide in the Dow Jones Industrial Average (DIA) January 4, the worst start to a year since the credit crisis in 2008, reminded us why we hold more than a 30% cash position in both newsletter portfolios at the moment: with a US stock market still near all-time highs, we like having ample capital available to scoop up bargains as stocks inevitably give back some of their gains. The question for us is not whether the broader US stock market will decline from here but whether such a decline will be 10%, 20% or more. After all, the S&P 500 (SPY) has essentially tripled from the March 2009 … Read more

Is the Worst Behind Us? Not Likely

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By Brian Nelson, CFA US natural gas prices (NGAS) recently dropped to the lowest level in nearly 14 years. Unseasonably warm weather may be to blame for the near-term drop, but we point to more structural concerns that may keep natural gas prices low for some time. Including both unconventional and conventional global natural gas resources, for example, there are more than 200+ years’ of supply based on the current trajectory of demand, and that doesn’t account for technology advances that will inevitably be made in the coming decades. Can you believe it? The situation with crude oil prices is not much better. West Texas crude oil prices (USO) dipped below $35 per barrel recently, still the high end of … Read more