CLAR

The Market is Getting Ahead of Itself with Pool Corp

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Image Source: Pool Corporation – IR Presentation By Callum Turcan Since emerging from the Great Financial Recession, wholesale pool and backyard products distributor Pool Corp (POOL) has been on an upward tear with shares climbing from ~$12 in 2009 to ~$185 as of this writing. This surge is largely why its dividend yield is at 1.2%, considering Pool allocates a considerable amount of cash flows towards dividends. We like Pool’s free cash flows and growth trajectory; however, shares appear overvalued after its epic run. Our fair value estimate for the company stands at $134 per share, up from $113 previously (as of January 2019), and the top end of our fair value range now stands at $168 per share. It’s … Read more

Our Reports on Stocks in the Sporting Goods Industry

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Image Source: Pool Corp. Structure of the Sporting Goods Industry The seasonal sporting goods industry is heavily tied to sporting trends and relies on large athletic partners to distribute their athletic goods and apparel. Exclusive licenses can help certain firms achieve competitive advantages, and while scale helps, small companies have been able to carve out favorable niches. Unlike other apparel industries, we have yet to see tremendous online competition emerge. Potential firearm regulation could negatively impact sales, but most companies are well diversified. We’re neutral on the space, but continued consolidation could ultimately benefit industrywide pricing and margins. We’ve dropped coverage of reports on stocks in the Sporting Goods industry: CLAR, ELY, JOUT, NLS, POOL.

Valuentum Stock Screeners

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This article was sent to members via email December 29. That email can be accessed at the link that follows this article. By Brian Nelson, CFA Hi everyone, I wanted to provide an update with respect to Valuentum’s stock screeners. We believe our stock screeners are among the most robust when it comes to providing forward-looking data, or data that is important with respect to the investment decision-making process. We publish screens in each of the monthly newsletters, but we also provide a basic weekly screener for download on the left column of the website, “Download Weekly Stock Screener (xls) — login required.”   We also have other products. The more robust DataScreener, for example, is part of the quarterly Financial … Read more

Market Mayhem — Alerts for Members

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During these extremely volatile times, it’s important to stay focused. On December 15, we informed all of our members to “Pay Attention.” Shortly thereafter, we notified members of the potential for a stock market technical breakdown. This morning, we offered a pre-market briefing about the importance of thinking about portfolio protection. For Best Ideas Newsletter and Dividend Growth Newsletter members: http://campaign.r20.constantcontact.com/render?preview=true&m=1110817109903&ca=e2406cd6-c113-4344-8731-493f33fc44a4&id=preview For High Yield Dividend Newsletter members: http://campaign.r20.constantcontact.com/render?preview=true&m=1110817109903&ca=b3ba530f-38b3-489a-ac96-2961dca89c6b&id=preview For Exclusive members: http://campaign.r20.constantcontact.com/render?preview=true&m=1110817109903&ca=ba6d90c0-4433-48b2-9b8a-aac4ddf9006e&id=preview We’re here for any questions. Please just let us know how we can help! Kind regards, Brian Nelson, CFA  brian@valuentum.com

Valuentum’s Weighted Average Cost of Capital (WACC) Distribution

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The weighted average cost of capital is one of the most subjective measures in corporate finance, but it is also one of the most important ones. “The most important item over time in valuation is obviously interest rates…If interest rates are destined to be at low levels…It makes any stream of earnings from investments worth more money. The bogey is always what government bonds yield….Any investment is worth all the cash you’re going to get out between now and judgment day discounted back. The discounting back is affected by whether you choose interests rates like those of Japan or interest rates like those we had in 1982…When we had 15 percent short-term rates in 1982, it was silly to pay … Read more

Fishing Trends Benefiting Many Sporting Goods Retailers

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Johnson Outdoors is benefiting greatly from fishing-related sales, and such a tailwind may be helping other sporting goods retailers in the group. New store openings continue to drive Dick’s Sporting Goods’ top-line higher, but the company’s materially increased profit guidance for fiscal 2018 stole the show in its fiscal first quarter report. By Kris Rosemann The sporting goods industry seems to have found the path to resiliency, despite continued political debate around gun control in the wake of school and event shootings, and some vendors such as Dick’s Sporting Goods (DKS) even going as far as destroying the assault weapons once for sale on their shelves. We’ll talk more about Dick’s Sporting Goods’ strength in this note, which has positive … Read more

Study: Valuentum’s Best Ideas Newsletter Portfolio

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To read the study, please click on the image to download the pdf document (pdf).

The “Luck” and “Randomness” of Index Funds

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Please select the image below to download the document. Image shown, page 1 of 14. Tickerized for Valuentum’s coverage universe.

Video: Quants! You’re NOT Measuring VALUE and Nelson’s Theory of Universal Value

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President of Investment Research Brian Nelson defines the concept of universal value and shows how quantitative statistical methods are inextricably linked to those of fundamental, financial, business-model related analysis. Value does not exist in respective process vacuums! Value is universal. Find out why. Running time: ~10 minutes.  Tickerized for Valuentum’s stock and ETF coverage universe. Transcript Hi this is Brian Nelson from Valuentum Securities, and this is the tenth edition of a series that I call “Off the Cuff,” where I get in front of the camera and I talk for ten minutes. This is what we have to talk about today. We have to talk about this concept: The Theory of Universal Value. Value does not exist in vacuums … Read more

2,350-2,750 on the S&P? Could the Coronavirus Catalyze a Financial Crisis?

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Image: We think a rather modest sell-off in the market to the target range of 2,350-2,750 on the S&P 500 is rather reasonable in the wake of one of the biggest economic shocks since the Global Financial Crisis. The chart above shows how far markets have advanced since 2011, and an adjustment lower to the target range of 2,350-2,750 is rather modest in such a context and would only bring markets to late 2018 levels (note red box as the target range). The range reflects ~16x S&P 500 12-month forward earnings estimates, as of February 14, adjusted down 10% due to COVID-19. When companies like Visa talk about a couple percentage points taken off of growth rates, one knows that … Read more