COST

Recent Data Indicates US Consumer Spending Holding Up Well, Online Sales Surging

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Image Shown: As of this writing, the S&P 500 (SPY) appears ready to end 2020 on a high note, supported by the resilience of the US consumer. By Callum Turcan The ongoing coronavirus (‘COVID-19’) pandemic accelerated the shift towards e-commerce, and that change has long legs. Retailers that previously invested in their digital operations and omni-channel sales capabilities were able to capitalize on this shift while those that relied heavily on foot traffic were hurt badly. Numerous retailers went under in 2020 including J.C. Penney Company Inc (JCPNQ) and Neiman Marcus. Holiday season shopping data indicates that US consumer spending was frontloaded and grew modestly in 2020, aided by surging e-commerce sales, which advanced nearly 50% on a year-over-year basis. … Read more

Target Reaches All-Time Highs

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Image Shown: Shares of Target Corporation are now trading near their all-time highs as of this writing. By Callum Turcan Shares of Target Corporation (TGT) recently reached an all-time high after the company reported third quarter earnings for fiscal 2020 (period ended October 31, 2020) on November 18 that smashed past consensus estimates on both the top- and bottom-lines. The top end of our fair value estimate range sits at $182 per share, and as of this writing, shares of TGT are trading near $172, indicating Target appears fairly valued at this time. Shares of TGT yield a decent ~1.6% as of this writing, and we give Target a “GOOD” Dividend Safety rating given its impressive cash flow profile. Operational … Read more

Walmart’s Digital Strategy Continues to Pay Off

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Image Shown: Walmart Inc continues to distribute its free cash flows back to shareholders via dividends and share repurchases. The retailing giant’s management team has a long track record of being shareholders friendly. However, we still view shares of WMT as generously valued as of this writing, given that the top end of our fair value estimate range sits at $133 per share though WMT is currently trading closer to ~$150 per share. Image Source: Walmart Inc – Third Quarter of Fiscal 2021 IR Earnings Presentation By Callum Turcan On November 17, Walmart Inc (WMT) reported third quarter earnings for fiscal 2021 (period ended October 31, 2020) that beat consensus estimates on both the top- and bottom-lines. As we have … Read more

Costco Closes Out Fiscal 2020

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Image Shown: Shares of Costco Wholesale Corporation have been on an upswing over the past five years. By Callum Turcan The ongoing coronavirus (‘COVID-19’) pandemic has upended daily activities and encouraged households worldwide to stockpile consumer staples products. When Costco Wholesale Corporation (COST) reported its fourth quarter fiscal 2020 earnings (16-week period ended August 31, 2020) on September 24, management noted that Costco’s worldwide foot traffic was down ~1% year-over-year last fiscal quarter though its average basket size was up ~13% year-over-year during this period. Households are apparently making the most out of every shopping trip in order to socially distance.   Costco’s ancillary businesses, like its in-store opticians and food courts operations, were hurt by temporary closures last fiscal … Read more

Macy’s Is Treading Water for Now

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Image Shown: Shares of Macy’s Inc have flatlined since crashing during the first three months of calendar year 2020 as investors await signs of the embattled retailer’s turnaround strategy taking hold. By Callum Turcan On September 2, embattled retailer Macy’s Inc (M) reported second quarter fiscal 2020 earnings (period ended August 1, 2020) that saw the firm’s comparable sales drop 34.7% year-over-year at stores owned by Macy’s due primarily to physical store closures brought on by the ongoing coronavirus (‘COVID-19’) pandemic. The year-over-year decline in comparable sales deepened to 35.1% when including stores owned and licensed by Macy’s. Digital sales offered some reprieve as those were up 53% year-over-year last fiscal quarter, with digital sales as a percentage of the … Read more

3 Lessons in Portfolio Management Over 10 Years

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Dear members: — We’re finally getting a pause in the rapid ascent of the markets on September 3rd. Though headlines may look scary and momentum/volatility investors could start to pile on to the downside, a modest retracement is actually a good thing. We continue to focus on the long haul with our processes, and we’re viewing the sell-off as profit taking, for the most part. — In the near term, the markets will also have to digest some speculators betting on mean reversion between “value” (cyclical) versus “growth” (secular), but we maintain the view that the value-versus-growth conversation is largely nonsense (see block quotes below), and mean reversion is something akin to the gamblers’ fallacy, in my humble opinion. Investors should also continue … Read more

Valuentum Website Overview

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Overview of the key features of valuentum.com/ (03:55). Valuentum (val∙u∙n∙tum) [val-yoo-en-tuh-m] Securities Inc. is an independent investment research publisher, offering premium equity reports, dividend reports, and ETF reports, as well as commentary across all sectors/companies, a Best Ideas Newsletter (spanning market caps, asset classes), a Dividend Growth Newsletter, modeling tools/products, and more. Independence and integrity remain our core, and we strive to be a champion of the investor. Valuentum is based in the Chicagoland area. Valuentum is not a money manager, broker, or financial advisor. Valuentum is a publisher of financial information. The Benefits of Premium Membership >> Subscribe Now!

Target Posts Stellar Comparable Store Growth, Digital Investments Lead the Way

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Image Source: Target Corporation – May 2013 IR Presentation By Callum Turcan Elevated demand for consumers staples products and rebounding consumer discretionary sales helped Target Corporation (TGT) report record comparable store sales growth in the second quarter of fiscal 2020 (period ended August 1, 2020), which were up 24.3% year-over-year. Digital comparable sales were up a whopping 195% year-over-year as same-day delivery services grew by 273%, with Target citing strength at its curbside pickup, order online/pickup in-store and home delivery options. Please note Target generates virtually all of its revenues in the US. Market Share Gains and Digital Investments The uplift in US consumer spending power from the Coronavirus Aid, Relief, and Economic Security Act (‘CARES Act’), particularly the direct … Read more

Amazon Secures Big Win in the Online Grocery Market

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Image Shown: Shares of Amazon have surged over the past year. Compared to their March 2020 lows, shares of AMZN have almost doubled as of this writing on August 10, 2020. By Callum Turcan On July 30, Amazon (AMZN) reported second-quarter earnings for 2020 that beat consensus top- and bottom-line estimates by a mile. As of this writing, shares of AMZN have almost doubled since hitting their March 2020 lows as Amazon’s lines of business were well-prepared to ride out the storm created by the ongoing coronavirus (‘COVID-19’) pandemic, assisted by the firm’s pristine balance sheet. Earnings Overview Amazon grew its GAAP net revenues by 40% year-over-year in the second quarter of 2020, which hit $88.9 billion on the back … Read more

Walgreens Targets Cost Cuts and In-Store Doctors’ Offices

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Image Source: Walgreens Boots Alliance Inc – Third Quarter Fiscal 2020 IR Earnings Presentation By Callum Turcan On July 9, Walgreens Boots Alliance Inc (WBA) reported its third-quarter fiscal 2020 earnings (period ended May 31, 2020) and raised its dividend by ~2% on a sequential basis. Walgreens has increased its annual dividend over the past 45 consecutive years, earning it Dividend Aristocrat status, though we caution its net debt load weighs negatively on its forward-looking dividend coverage. Shares of WBA yield ~4.6% as of this writing. Walgreens suspended its share buyback program to preserve cash in the face of the ongoing coronavirus (‘COVID-19’) pandemic and additionally, management initiated full year guidance for Walgreens’ fiscal 2020 during its latest earnings report. … Read more