DG

Dividend Increases/Decreases for the Week Ending March 11

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Colgate-Palmolive continues to enjoy the benefits of being a Dividend Aristocrat as it garners an elevated multiple as one of the most well-known consumer staples entities. Image source: Fredrick Rubensson Below we provide a list of firms that raised/lowered their dividends during the week ending March 11. 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 Alexandria Real Estate Equities (ARE): now $0.80 per share quarterly dividend, was $0.77. American Tower (AMT): now $0.51 per share quarterly dividend, was $0.49. Citizens Financial Services (CZFS): now $0.415 per share quarterly dividend, was $0.41. Colgate-Palmolive … Read more

Bellwether Snapshot: Walmart, Boeing, CSX

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Alcoa (AA) kicked off third-quarter earnings season with a wimper, which had been preceded by Yum! Brands’ (YUM) doozy of a showing. Incremental news impacting the expected performance of Walmart (WMT), Boeing (BA), and CSX (CSX) hasn’t been great either. Investors continue to write off weakness as “normal,” even “macroeconomic” as if it doesn’t matter, pointing to the transient nature of a struggling global economy suffering from a slowdown in the pace of growth in China and weakness in export-dependent countries, not the least of which is Brazil, as somehow a “good thing,” but it may not matter. The trajectory of expectations of future free cash flow generation is being impacted, and so are fair value estimates as a result, … Read more

Target or Walmart?

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Image Source: Steven Depolo It’s not the roaring 1990s anymore, investors! There are serious risks to the business models of Target (TGT) and Walmart (WMT), and everyone is looking the other way, consoling themselves with their steady and growing stream of dividends. These investors say, “as long as they pay the dividend, I don’t care,” as if this signals a proud achievement in some way, by which many experienced market participants will then respond, “and now we know why the individual investor is frequently blindsided.” The dividend is a symptom of the health of free cash flow, and management teams can dip into the balance sheet to support the payout. Only trends in free cash flow generation, supported by moaty … Read more

Yum! Brands’ Fourth-Quarter Earnings Preview

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Yum! Brands reports after the bell today. Watch Valuentum’s President Brian Nelson on CNBCAsia at 5:40CT. If 16%+ comparable-store sales growth during any given period can ever be described as such, Chipotle (CMG) dropped the ball during its calendar fourth quarter. The fast-casual burrito maker’s shares are facing pressure as a result of management’s overly conservative comp guidance of low-to-mid-single digit growth for 2015, as if we haven’t seen this before. Chipotle sets the bar low and then hurdles over it like an Olympic high-jumper. McDonald’s (MCD), on the other hand, is in a world of hurt, and with CEO Don Thompson’s retirement, the brand has been shaken to the core as it struggles to connect with millennials. Investors in … Read more

Walmart and Target Both Beat Expectations

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Big box retailers have showcased some resilience during the third quarter, with Home Depot (HD), Lowe’s (LOW) and Dick’s Sporting Goods (DKS) posting relatively strong results. Walmart (WMT) and Target (TGT) also followed through with respectable quarters, and we think this bodes well for most of the group heading into the holiday season. Walmart’s third-quarter results, released November 13, showed consolidated net sales advancing 2.8% with US comparable store sales increasing 0.5% for the 13-week period ended October 31, 2014. Walmart has been under competitive attack from a variety of fronts. Not only is Target its key rival, but dollar stores such as Family Dollar (FDO), Dollar General (DG) and Dollar Tree (DLTR) have been nipping at its heels through … Read more

Walgreen’s and Target Distracted; Dollar General Enters the Fray

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Walgreen’s (WAG) and Target (TGT) have been in the news quite a bit as of late–Walgreen’s bowing to political pressure from the proposed ban on tax ‘inversion deals’ and Target as a result of its delayed disclosure of the magnitude of its credit card data breach. Both items have been a major distraction to the respective executive suites, and it is starting to show. In the case of Walgreen’s, the CFO and pharmacy chief lost their jobs today, in part as a result of a ~$1 billion forecasting error related to its prescription-drug business. Though the revision is not an act of illegal wrongdoing (companies change forecasts all the time), the revision is still an embarrassment for the company, especially in light … Read more

Valuentum Economic Castleâ„¢ Rating Update

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Read: Keeping the Horse Before the Cart: Valuentum’s Economic Castle™ Rating The Economic Castle Focuses on the Magnitude of Economic Value Creation The Valuentum Economic Castle™ rating is an enhancement of the competitive advantage framework (commonly known as economic moat analysis) that has become widespread and ubiquitous within the investing world. Whereas an economic moat framework evaluates a firm on the basis of the sustainability and durability of its competitive advantages, Valuentum’s Economic Castle™ rating evaluates a firm on the basis of the firm’s future economic profit spread (return on invested capital less its weighted average cost of capital). The companies with the strongest Valuentum Economic Castle™ ratings are poised to generate the most economic value for shareholders in the … Read more

Dollar General’s Outlook A Little Light; Could Consolidation Be Brewing in the Dollar Store Space?

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The retail discount store industry (or the dollar-store industry) provides consumable basic needs to customers primarily in the low- and middle-income brackets. More than one third of the industry’s customers live in households that earn less than $20,000 per year, making the group’s results counter-cyclical–as more households generate lower income due to poor economic conditions, store growth and same-store-sales opportunities increase. Still, competition is fierce among constituents and with many other retailers, including grocery stores. But given the niche low-price strategy of participants and their counter-cyclical nature, we tend to like the group.  Dollar General (DG) has been operating at a level higher than that of its dollar-store peers, but its outlook for fiscal year 2014, released in its fourth … Read more

What a Week in Retail: Some Good, Mostly Bad

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The week ending January 10 brought a plethora of news that confirmed our fears: promotional activity during the shortened holiday shopping season of 2013 wasn’t just bad, it was cutthroat. Many retailers were left unable to recover from the ice and winter storms that ravaged much of the US during December/early January. Bed Bath and Beyond (BBBY) Five Below (FIVE), Pacific Sunwear (PSUN), Sears (SHLD) and Zumiez (ZUMZ) all revealed difficult performance during the period. The variant business models of the aforementioned retailers suggest weakness was widespread. Surprisingly, even discount retailing giant Family Dollar (FDO) wasn’t able to lower prices enough to keep customers in the stores. No category seemed to be spared. Needless to say, we’re not expecting much … Read more

Surveying the Retail Landscape: Dollar General, Kroger, and Costco

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On Thursday, Dollar General (DG), Kroger (KR) and Costco (COST) reported quarterly results. Dollar General’s third-quarter report showed same-store sales advancing 4.4%, which propelled total sales 10.5% higher during its third quarter (ending November 1). Kroger’s third-quarter report showed 3.5% identical supermarket sales growth, without fuel, during the period ending November 9, while Costco’s fiscal first-quarter results (ending December 1) revealed same-store sales expansion of 3% during the quarter. Dollar General’s quarterly performance not only bested that of Kroger and Costco, but it also stood head-and-shoulders above that of Wal-Mart (WMT), which reported a comparable store sales decline in Walmart US and only a 1.1% increase at Sam’s club, and Target’s (TGT) third-quarter performance, where US comparable store sales advanced only … Read more