FRED

The Valuentum Strategy in Action: Why We Are Letting BIN Holding Dollar General Run Higher

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Image Shown: Best Ideas Newsletter holding Dollar General Corporation (DG) jumped up after posting great performance during the second quarter of its fiscal 2019 on August 29. The company has trounced the market return since it was added to the Best Ideas Newsletter in April 2017. We are letting this winner run higher. By Callum Turcan On August 29, our favorite discount retailer Dollar General (DG) posted second quarter FY2019 earnings (ended August 2) that saw shares of this Best Ideas Newsletter portfolio holding fly higher after the report. GAAP net sales rose by 8.4% year-over-year and same-store sales were up 4.0% during the quarter, which we strongly appreciate, as Dollar General continues to showcase why flexibility and convenience are … Read more

Target Stuns, Shares Jump Higher

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Image Shown: Shares of Target Corporation (TGT) leapt higher on August 21 on the back of its strong performance during the second quarter of FY2019. In particular, the retailer’s comparable same store sales growth was quite impressive given the hard comparison period, with e-commerce and same-day fulfillment leading the way. By Callum Turcan On August 21, Target Corp (TGT) reported very strong second quarter FY2019 earnings (three months ended August 3) that sent shares up ~20% on the trading session. For starters, comparable store sales growth clocked in at 3.4% year-over-year and was up 9.9% on a two-year basis (adding comp growth from the second quarter of 2018 and 2019 together). That indicates this was much more than just a … Read more

Macy’s Cuts Guidance, Dividend Cut Could Be on the Horizon

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Image Source: Macy’s Inc – IR Presentation By Callum Turcan Retailers (XRT, RTH) have been struggling as the e-commerce shift has stressed margins and hurt foot traffic at stores and malls all across America. Macy’s Inc (M) had fared better than most, but that’s beginning to change. The company reported second quarter FY2019 earnings on August 14 which came with a guidance cut that saw shares of Macy’s plummet below their late-2017 lows. While Macy’s recovered throughout the trading day, the market is clearly signaling that investors are expecting more pain is ahead. As of this writing, shares of Macy’s yield ~9.0%, a major red flag. Guidance Cut Management cut earnings guidance for the full fiscal year while keeping estimates … Read more

Dollar General Continues to Lead

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Image Source: Dollar General Corporation – IR 2016 Presentation By Callum Turcan Dollar General Corporation (DG) is one of the holdings in the simulated Best Ideas Newsletter, and shares yield 1% as of this writing. The company had ~15,500 stores situated across 44 states as of March 1, 2019, making Dollar General the largest discount retailer by store count. Its business model is built around selling low-cost items that e-commerce firms couldn’t economically ship without being part of a much larger order. Around three-quarters of Dollar General’s stores are located in towns with populations of 20,000 or less, giving it another edge on its competitors like Amazon Inc (AMZN) due to the logistical problems that arise when selling very small … Read more

Best Ideas Newsletter Idea Dollar General Strong in Difficult Market

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Image shown: Dollar General has exceeded the market’s return by more than 50 percentage points since being added to the simulated Best Ideas Newsletter in April 2017. The dollar stores are a nice area to be when the economic environment grows more uncertain, and we continue to like Dollar General as the play in this area. It remains a staple in the Best Ideas Newsletter portfolio. By Brian Nelson, CFA There may be one certainty when it comes to the economic environment, and that is uncertainty. The markets have had one of the best bull-runs in history since the doldrums of the March 2009 bottom, and perhaps nobody could have predicted the magnitude of the pace of economic expansion since … Read more

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

Dollar General Slips on Lower Bottom-Line Guidance

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Simulated Best Ideas Newsletter portfolio idea Dollar General continues to deliver consistent top-line performance, but higher than expected expenses in the second half of its fiscal 2018, including hurricane-related expenses and rising transportation costs, resulted in a reduction of operating margin and diluted earnings per share guidance. Net sales growth expectations were also tempered slightly. By Kris Rosemann Margin performance across the retail space has left a bit to be desired of late, “Retail Margins Weighed Down by Labor, Transportation Costs,” and simulated Best Ideas Newsletter portfolio idea Dollar General (DG) was unable to avoid some of the pressures as its fiscal third quarter report, results released December 4, brought with it slightly lower margin expectations for the full fiscal … Read more

Dollar General Keeps Growing; Guidance Raised

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Image shown: Dollar General’s share price performance since early 2017. It was first highlighted in the simulated Best Ideas Newsletter portfolio in April 2017. Simulated Best Ideas Newsletter portfolio idea Dollar General turned in a solid fiscal second quarter report and subsequently raised its top-line guidance. Shares have advanced nearly 60% since we first highlighted the company, and its business continues to be a model of consistency. Kris Rosemann Simulated Best Ideas Newsletter portfolio idea Dollar General (DG) continues to drive its top line higher, and its consistently positive same-store sales growth over the past nearly three decades has been nothing short of impressive. Its fiscal 2018 second quarter report, results released August 30, only reaffirmed such a notion. Strength … Read more

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