GLD

This Stock Market Doesn’t Scare Me

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Dear members:   It’s amateur hour at Seeking Alpha, it seems. Most have been calling for a market crash the past week or so, but it’s hard for me to take many writers over there too seriously. Neither should you. We had the crash in February/March of this year, and the Fed/Treasury will do what it takes to prevent another one, in my view. Let me say it for the first time: This stock market doesn’t scare me.  The reality is that we finally bumped up into fair value range. It wasn’t a day or two after I sent out a market alert to you to let you know that markets are now fairly valued when we started to see some … Read more

ALERT: Markets Now Fairly Valued

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Hi everyone: — Long-term investing is a great proposition. You have an incredible advantage over most professional investors that have to deliver on a quarterly or annual basis. The reason is due to something called time horizon arbitrage.  — For example, where most professionals are focused on near-term economic data or near-term earnings, you can focus on how the broader earnings trajectory might look like in 2022 and beyond. I think we’d both agree that the economic data or earnings performance for the remainder of 2020 won’t matter much when we turn the calendar to 2021 in just a few months–and in 2021, the market will be looking at 2022 numbers.  — Markets will always be forward-looking, and stocks are long-duration … Read more

Newmont Surges Higher, Posts Solid Earnings Report

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Image Shown: Newmont Corporation’s operational and financial performance has held up well in the face of the pandemic, relatively speaking. Image Source: Newmont Corporation – Second Quarter of 2020 IR Earnings Presentation By Callum Turcan Back on January 13, 2020, we added gold miner Newmont Corporation (NEM) to the Dividend Growth Newsletter portfolio at a modest weighting. Since then, shares of NEM are up ~64% as of this writing on August 6. Please note we significantly increased our fair value estimate for Newmont in July, and the firm’s updated 16-page Stock Report can be viewed here. Part of the reason for the positive revision came from Newmont expecting that it will generate greater synergies than first envisioned when it acquired Goldcorp … Read more

Excerpt from ‘Value Trap’ 2nd Edition: MPT Sounds a Lot Like “Empty”

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The second edition of President of Investment Research Brian Nelson’s book ‘Value Trap’ will be released in the coming weeks. Here is a short excerpt to whet your appetite: — … — Enterprise valuation, or the discounted cash-flow framework, remains at the center of finance, in my view, and the core of what we do at Valuentum. The process and its key cash-based components helped deliver a suite of outperforming equity considerations at a time when modern portfolio theory (MPT) and diversification benefits were breaking down. Both stocks and bonds, for example, dropped aggressively in unison during the COVID-19 crisis, and the popular U.S. 60-40 stock/bond portfolio “suffered one of its worst performances since the 1960s” during the first quarter … Read more

Freeport-McMoRan’s Outlook Improves Considerably

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Image Source: Freeport-McMoRan Inc – February 2020 IR Presentation By Callum Turcan Global copper, gold, and molybdenum miner Freeport-McMoRan Inc (FCX) suspended its quarterly common dividend in March 2020 and provided a revised outlook for the full-year in April 2020 due to the coronavirus (‘COVID-19’) pandemic hampering both commodity prices and its operational performance. One of those hurdles involved the Peruvian government imposing restrictions on its Cerro Verde mine in March 2020 (as part of COVID-19 containment efforts), a copper mine that Freeport-McMoRan owns a ~54% stake in. Another hurdle involved the collapse in commodity prices earlier this year (though gold prices have held up quite well in 2020). First, let us provide some background before highlighting why Freeport-McMoRan’s outlook … Read more

Covering One of Newmont’s Lowest Cost Gold Mining Operations

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We covered Newmont’s first quarter 2020 earnings back in early-May and continue to like the gold miner in the Dividend Growth Newsletter portfolio. Newmont’s Dividend Cushion ratio stands at 2.2 which provides for a “GOOD” Dividend Safety rating and we like the firm’s payout growth trajectory which earns the firm a “GOOD” Dividend Growth rating as well. Please note our Dividend Cushion ratio and Dividend Safety rating incorporates our expectations that Newmont will push through modest dividend increases over the coming years. By Callum Turcan Newmont Corporation (NEM) is our favorite gold miner and we added shares of NEM to our Dividend Growth Newsletter portfolio back on January 13, 2020 (link here). Shares of NEM are trading in the upper … Read more

Earnings Roundup for Week Ended May 17

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Image Shown: We cover several earnings reports in this article across several sectors and industries to provide an overview of how corporates performed during the early stages of the ongoing coronavirus (‘COVID-19’) pandemic. 

Reducing expenses, generating efficiency gains, and ultimately improving the cost structure of corporates appears to be a key theme during the first-quarter 2020 earnings cycle. Management teams across the board are hunkering down and preparing for the pain to continue as global economic activity is expected to grind to a halt in the second quarter of 2020, before recovering somewhat due in part to massive fiscal and monetary stimulus measures that were launched to offset the negative impact COVID-19 is having on economic activity.

Gold Miner Newmont Continues to Shine

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Image Source: Newmont Corporation – First Quarter of 2020 Earnings IR Presentation By Callum Turcan On May 5, the gold miner Newmont Corporation (NEM) reported first quarter 2020 earnings that missed both consensus top- and bottom-line estimates which prompted shares to sell off modestly during the normal trading session that day, though shares of NEM have been on an epic bull run since the start of 2020. We continue to like Newmont as an idea in our Dividend Growth Newsletter portfolio with shares of NEM up ~48% as of this writing since joining the portfolio on January 13, 2020 (link here), before taking dividend considerations into account, while the S&P 500 (SPY) is down ~13% during this period before taking … Read more

Dow Fell 9.99%, Worst Point Drop in History, More Nibbling?

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Dow Fell 9.99%, Worst Point Drop in History, More Nibbling? — Image: On March 12, 2020, the Dow Jones Industrial Average fell 2,353 points, the most in its history, and the most in percentage terms since Black Monday in 1987. The Dow Jones Industrial Average fell 9.99% March 12, 2020, to 21,200.62. — From Value Trap: During the dark days of 2008 and 2009…where widespread and indiscriminate selling was prevalent, correlations among stock sectors rose considerably. According to data from Morningstar, average daily correlation over the trailing six months between individual stocks increased to 0.66 at the end of 2011 from just 0.10 in 1994. The average sector correlation for monthly returns on the S&P 500 index was 0.84 during the Financial Crisis … Read more

Newmont Posts a Great Earnings Report

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Image Shown: A look at Newmont Corporation’s asset base, which is heavily centered on the Americas and Australia, with some exposure to West Africa as well. Image Source: Newmont – Fourth Quarter and Full-Year 2019 IR Earnings Presentation By Callum Turcan On February 20, gold miner Newmont Corporation (NEM) reported a fourth quarter and full-year earnings report for 2019 that pleasantly surprised, with shares of NEM up sharply after the report during the trading session that Thursday. Back on January 13 (link here), we added a modest weighting of NEM shares to our Dividend Growth Newsletter portfolio as part of our pivot to more defensive names given rising exogenous headwinds to the global economy. While Newmont’s top-line marginally missed consensus … Read more