EBAY

Valuentum Mosaic Exclusive: Talks Between Yahoo and eBay Probable

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Let’s put it this way: the combined eBay and PayPal entity presently listed under the ticker symbol eBay (EBAY) is cheap. The combined company is trading in the mid-$50s with a market capitalization of ~$69 billion at present, and we value its shares in the mid-$70s (a ~$90+ billion valuation). We’re not the only one, in case you think that, despite everything we seem to get correct, we’re off our rockers with this valuation. Stifel, for example, recently labeled $75 per share as an upside case for the company. eBay remains a holding in the Best Ideas portfolio, and the equity markets are simply getting the company’s valuation wrong, in our view. It is one of the few true bargains … Read more

Thanksgiving Weekend Sales Were Weak…

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According to preliminary survey results released Sunday by the National Retail Federation, retail sales during the Thanksgiving weekend tumbled 11% to $50.9 billion from $57.4 billion during the same weekend last year. Executives are having a difficult time explaining the sharp drop off in retail sales (RTH), given similar aggressive strategies and promotions as previous years, but we think there are a few reasons for the hefty decline. For one, the lure of the post-Thanksgiving “mad-rush” may be wearing off, and the emerging “negative” social stigma of those willing to shop (instead of resting with family) coupled with those who believe they are “being forced to work” during the holiday (see Walmart strike) without fair wages may be turning off … 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

eBay Is Still Way Too Cheap

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News hit several weeks ago that eBay (EBAY) would separate its Marketplaces operations and its PayPal operations into two publicly-traded companies, a move that we think is a good idea to unlock shareholder value. Creating two standalone businesses best positions eBay and PayPal to capitalize on their respective growth opportunities in the rapidly changing global commerce and payments landscape, and is the best path for creating sustainable shareholder value. eBay and PayPal will be sharper and stronger, and more focused and competitive as leading, standalone companies in their respective markets…As independent companies, eBay and PayPal will enjoy added flexibility to pursue new market and partnership opportunities. And we are confident following a thorough assessment of the relationships between eBay and … Read more

Performance of the Valuentum Buying Index

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Note: A more recent analysis of the Valuentum Buying Index rating system can be accessed at the following link: /Value_and_Momentum_Within_Stocks_Too Two separate studies have reinforced the efficacy of the Valuentum Buying Index, both as a portfolio optimization tool and as an idea generator. If you cannot view the video, please consult the transcript that follows. To view Valuentum’s updated YouTube page, please see here.  The studies referred to in this video can be accessed as follows: Why Valuentum Buying Index Ratings Matter: /20141003_1 Valuentum’s Performance on Seeking Alpha: /20141009 Please be sure to read the studies closely in addition to watching the video or consulting the transcript below. Brian Nelson, CFA: This is Brian Nelson from Valuentum Securities. I’d like to talk … Read more

Pay Attention!

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I just wanted to send a quick reminder out there because frankly this is amazing, and I’m very, very concerned readers aren’t focusing on the right things. First, I wanted to start with a couple examples. Example 1: If you pull up a 16-page report and, let’s say, it is dated from late April, and the company had registered a 9 on the index and shares were trading $24 at the time. If the stock is now in the mid-$30s, your response should be: “Wow, the stock registered a 9 and now has advanced significantly. The methodology really highlighted this one.” Your response should not be that the report is dated from April. Micron Tech (MU). Excerpt Micron Report, page … Read more

Apple Conference Better Than Expected

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It is sometimes with hesitation that we talk about Apple (AAPL) because it is one of the most widely covered stocks. We often try to highlight hidden gems across our coverage universe, but when things are going well…well…things are going well. The iPhone maker has been one of the best performers in the Best Ideas portfolio and Dividend Growth portfolio, and the new products at the September 9 event speak to continued sustainability of strong fundamentals. View event replay here >> The biggest surprise at the event, in our view, was the release of both Apple’s first wearable device (called Apple Watch) and its first payments solution (called Pay). “The Apple Watch is available in two different sizes and comes … Read more

Apple Hacked! Not Alone.

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By Brian Nelson, CFA It’s difficult to be a business these days. Not only do you have to provide a service that customers are willing to pay for, but your customers have to have the means to pay for it. But more and more, we are seeing that businesses have more obstacles to overcome, and I’m not just talking about increased regulations. I’m talking about hackers, and their work is becoming more and more prevalent. Target (TGT) continues to be distracted from its credit data breach, while eBay (EBAY) recently reported a cyber attack, though of the less-serious variety. This week, reports indicate that Home Depot (HD) has been the target of a massive credit card data breach. Though admitting … Read more

Performance Update: The Valuentum Buying Index

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Note: A more recent analysis of the Valuentum Buying Index rating system can be accessed at the following link: /Value_and_Momentum_Within_Stocks_Too A version of this article was published October 26, 2013. By Brian Nelson, CFA We periodically update the performance results of the Valuentum Buying Index (VBI), the stock-selection methodology that drives idea-generation within the Best Ideas portfolio. The academic studies of the Valuentum Buying Index can be accessed here (white paper) and here (AAII). The latest iteration of the performance, dated September 3, 2014, continues to showcase the strong sorting mechanism embedded within the investing framework, particularly when the index is coupled with qualitative oversight and portfolio management skill. Sorting winners from losers is what the Valuentum Buying Index has been designed to … Read more