CL

ALERT: Important Recap of Valuentum’s Research and Market Events

by

ALERT: Important Recap of Valuentum’s Research and Market Events: Unequivocally Bullish, S&P Target Range Was Withdrawn Last Month, Continued Focus on Individual Stock Selection with “Moaty” Operations, Huge Net Cash Positions, Strong Expected Future Free Cash Flows, Established Recurring Business Models, and Otherwise Attractive Economic Castles. Big Cap Tech and Large Cap “Growth” Remain Our Favorite Allocations. — Image: Breaking out to new highs, Facebook (FB) is a top weighting in the Best Ideas Newsletter portfolio (which includes our favorite capital appreciation ideas in a portfolio setting). The social media giant is surging on news of a new Shops feature, something we’ve been expecting and raving about with respect to its potential for years–as we maintain our view that, anti-trust considerations aside, Facebook … Read more

ALERT: Going to “Fully Invested” — The Fed and Treasury Have Your Back

by

Image Source: BEA. Real GDP fell at an annual pace of 4.8% in the first quarter of 2020, according to the “advance” estimate released by the Bureau of Economic Analysis. Summary For members to our new options commentary service, the second April options idea will be released tomorrow. We’re taking the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio to “fully invested,” scaling up our existing positions to reflect that status. We plan to consider put options to hedge against downside risk, if or when the time comes. Moral hazard continues to run rampant, and the Fed and Treasury may have no choice but to continue artificially propping up this market, even buying stocks through certain vehicles, if necessary. … Read more

Emergency Update on COVID-19

by

President of Investment Research at Valuentum, Brian Nelson provides an emergency update on COVID-19. He talks about how policymakers have dropped the ball thus far, and why investors should not let their guards down, despite what has been a nice bounce from the March 23 bottom. As of April 24, the world has now borne witness to the deaths of nearly 182,000 people from Coronavirus disease, or COVID-19, with more than 2.6 million confirmed cases. The United States remains the epicenter of the global pandemic with the country confirming 830,000 cases and more than 42,000 deaths. The sad reality is that, despite the many months that have now passed, medical professionals know little more about the disease than when news … Read more

What To Do Now?

by

— Dear members: — It’s Brian here. It seems like I went to bed February 22 after writing the following note to you — Is a Stock Market Crash Coming? — Coronavirus and P/E Ratios — and just woke up now. That’s how crazy the markets have been. It’s been two months of a whirlwind of a ride. For those just joining today, we recapped the events since our warning about the Great Crash of 2020 on February 22 in the following two videos — The Question Is If the Economy Can Be Held Together Without Vast Equity Dilution (April 12) and Will Hasty Policy Facilitate the Next Leg Down, or Do We Have It Coming Anyway? (April 19). — Before going on, I want to pause … Read more

Proctor & Gamble Pushes Forward

by

Image Source: Procter & Gamble Company – Third Quarter Fiscal 2020 Earnings IR Presentation By Callum Turcan On April 17, Procter & Gamble (PG) reported third-quarter fiscal 2020 earnings (period ended March 31, 2020) that beat consensus estimates on the bottom-line but missed consensus top-line estimates. Most importantly, Procter & Gamble showcased strong organic growth (organic volumes were up 6% company-wide year-over-year) as its ‘Health Care’, ‘Fabric & Home Care’, and ‘Baby, Feminine & Family Care’ segments posted 7%, 8%, and 6% net sales growth, respectively, on a year-over-year basis. Strong high-single-digit volume growth was key to offsetting unfavorable foreign currency headwinds at those three segments. Procter & Gamble’s ‘Beauty’ and ‘Grooming’ segments posted mild net sales declines on a … Read more

Our Reports on Stocks in the Household Products Industry

by

Structure of the Household Products Industry Firms in the household products industry sell some of the most recognized branded consumer packaged goods in the world and often hold a significant market share position in a variety of product categories. Though the industry is characterized by stiff competition from retailers’ private-label brands, constituents tend to boast meaningful competitive advantages due to their brand strength/reputation and generate high returns on invested capital. Household products companies remain tied to the vicissitudes of consumer spending, but we tend to like the structure of the group. We’ve optimized our consumer staples coverage. To view their reports, please click here.

Johnson & Johnson Beats Estimates, Adjusts Guidance in Light of COVID-19

by

Image Source: Johnson & Johnson – First Quarter 2020 Earnings IR Presentation By Callum Turcan On April 14, Best Ideas Newsletter and Dividend Growth Newsletter portfolio holding Johnson & Johnson (JNJ) increased its quarterly dividend by over 6% sequentially to $1.01 per share which represents the firm’s 58th consecutive annual increase. We view this payout boost in the face of the ongoing coronavirus (‘COVID-19’) pandemic as a sign of management’s confidence in Johnson & Johnson’s future free cash flows, which we appreciate. Shares of JNJ now yield ~2.8% as of this writing at the new annualized payout rate. Additionally, Johnson & Johnson also posted its first-quarter 2020 earnings report on April 14 which beat both consensus top- and bottom-line expectations … Read more

ICYMI — Video: The Question Is If the Economy Can Be Held Together Without Vast Equity Dilution

by

President of Investment Research at Valuentum and award-winning author of Value Trap: Theory of Universal Valuation Brian Nelson explains how the range of probable fair value outcomes of S&P 500 companies has increased as a result of COVID-19 and possible equity dilution on the downside to long-run inflationary pressures on stocks driven by runaway Fed and Treasury stimulus on the upside. — Editor’s note: Brian emphasizes the importance of “expert analysis” over “backward-looking analysis,” and we would like to clarify that he is not giving personalized advice. Valuentum members have access to our 16-page stock reports, Valuentum Buying Index ratings, Dividend Cushion ratios, fair value estimates and ranges, dividend reports and more. Not a member? Subscribe today. The first 14 days are … Read more

Repub from July 2019 — The Valuentum Economic Roundtable

by

This article was published July 23, 2019. We sat down with the Valuentum team to get their thoughts on the global economy and key issues that may threaten this near 10-year bull market. Let’s start with Valuentum’s Bank and Financials Contributor Matthew Warren, and then we’ll go around the horn. Matthew Warren: It’s interesting what’s happening at the nexus of the consumer and various retailers. It reminds me of the pockets of discretionary weakness back in 2008. I made money on Men’s Warehouse (TLRD) puts back then. Nobody is really in a rush to buy a suit, especially if they are concerned about their job prospects. At least we only have CLOs (collateralized loan obligations) and Europe/China stress to ponder … Read more

Bullets: Recapping the Crash, Where Are We Now?

by

Image: The S&P 500 has only retraced a small part of its decline since the top in February 2020. By Brian Nelson, CFA In August 2019, Valuentum took a cautious bent on the markets, removing the Financial Select Sector SPDR (XLF) and the Energy Select Sector SPDR (XLE), raising cash at the time. Financials and energy have been material underperformers during the swoon, with the Fed/Treasury launching more stimulus than the Great Financial Crisis and Saudi Arabia/Russia continuing their oil-price war. Here’s what we said in August 2019: August 2019: There are myriad risks as we near the end of this now-decade long bull market: a US-China trade/currency war, slowing global economic growth (Germany’s economic growth turned negative during the … Read more