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Discovery-Scripps Joining Forces to Take on the Changing Digital Media Landscape

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Image Source: Lwp Kommunikáció Discovery Communications has agreed to acquire Scripps Networks, but will it be enough for the two to remain competitive in the rapidly evolving–and consolidating–media landscape? By Kris Rosemann The cable TV industry is not what it was only a few short years ago, and Discovery Communications (DISCA) finally getting its hands on the assets of Scripps Networks (SNI) is only further evidence of this. Both companies have had a relative amount of success in delivering compelling programming to targeted audiences in years past via traditional pay-TV channels, but the days of tuning in to Shark Week on The Discovery Channel through your local cable provider are fading fast. The cord-cutting revolution is one that has been well-covered … Read more

Hasbro Hit by Gross Margin, Timing Issues

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Shares of Dividend Growth Newsletter portfolio holding Hasbro dropped after the company reported its second quarter earnings. By Kris Rosemann Dividend Growth Newsletter portfolio holding Hasbro (HAS) has been knocking the proverbial cover off the ball with returns (its stock has nearly tripled since being added to the Dividend Growth Newsletter portfolio) and the company has rival Mattel’s (MAT) back against the wall, but the toy giant’s shares recently hit a speed bump. In its second-quarter results, released July 24, Hasbro reported revenue growth of 11%, operating profit margin expansion of 60 basis points, and net earnings-per-diluted-share growth of nearly 30%, but shares faced significant pressure following the release. On the surface, it looks to be another strong quarterly report … Read more

Labor and the Economic Cycle

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As we arguably near the “peak” in the business cycle, labor is starting to demand more, a dynamic that we believe is emblematic of the period of aging economic expansion. Let’s have a look at what’s happening in the fight for higher wages. By Brian Nelson, CFA Each business cycle is different in both magnitude and duration, but there are some common qualities that define where an economy might be within the cycle. First, it has been more than 8 years since the March 2009 stock-market panic bottom, a period that witnessed firms such as Lehman Brothers, Bear Stearns, and AIG (AIG) flounder. The unemployment rate peaked at 10% during that difficult time. Since then, the US economy has emerged … Read more

Valuentum’s 3 Breakthroughs in the Field of Finance and More

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Valuentum’s President Brian Nelson pauses for a picture before speaking at the CFA Society of Houston in March 2017. By Valuentum Editorial Staff Let’s cover Valuentum’s 3 major breakthroughs in the field of finance. The first one is big and may challenge you to rethink everything you think you know about investing. 1. On a logical framework, Valuentum has debunked John C. Bogle’s landmark syllogism that has paved the way for the concept of index investing. Index investing has been built on a logical shortcoming, whether supported by evidence or not. We think it is important that the investment community know of this. Read (pdf): The “Luck” and “Randomness” of Index Funds (2018), Brian Nelson, CFA See video documentation: /FALLACY_of_Index_Funds To … Read more

Looking to Trim Apple; Star Wars Mania Continues

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Let’s get this out of the way. We’re not worried about Apple (AAPL) at all. The company is sitting on a mountain of net cash and is simply a free cash flow machine. We think the iPhone-maker’s products continue to fly off the shelves, and this holiday season for Apple may be the best in its storied history. But sometimes the market is just not fair…and for a company trading at less than 10 times forward earnings, excluding net cash, is borderline an injustice. Still, we plan to take some more profits on the company in the newsletter portfolios if we catch a strong updraft in the markets. We continue to value shares north of $140 each, and as the … 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

3 Important Pieces of News on the Monday of This Shortened Holiday Week

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The Hunger Games: Catching Fire Sets November Records Lions Gate’s (LGF) shares are under pressure this morning as the market’s expectations of The Hunger Games: Catching Fire, the second installment of the Hunger Games franchise, were just a bit too high, despite the film grossing approximately $160 million in North America over the weekend, setting a November record. Globally, the sequel catapulted to a $307.7 million opening, exceeding the original film’s $211.8 million debut in March 2012. The second Hunger Games movie grossed approximately $18 million in IMAX (IMAX) theaters worldwide and $12.6 million in 347 IMAX theaters in North America since the November 22 release. IMAX noted that this was the best three-day domestic opening for November in IMAX’s … Read more

Nelson: The 16 Most Important Steps To Understand The Stock Market

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A previous version of this article appeared on our website July 21, 2013. Refreshed and updated throughout, as of July 2018. By Brian Nelson, CFA After earning my MBA at the University of Chicago Booth School of Business and training stock and credit analysts from large organizations over the past decade or so, I have heard just about every question (though I admit I am still surprised by many things and remain a very humble student of the markets). I’ve also spent years perfecting the discounted cash flow process for large research organizations such as Morningstar and studied under one of the most famed aggressive growth investors of all time, Richard Driehaus. My knowledge runs the gamut from value through … Read more

Stock Market Outlook for 2021

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By Valuentum Analysts February 8, 2021 2020 was one for the history books. We covered our thoughts and reflections on the past year in our “2020 Won’t Soon Be Forgotten” article (link here), and now we are looking towards the future. Global health authorities should be able to bring an end to the ongoing coronavirus (‘COVID-19’) pandemic sooner than many had expected as several vaccines have already been improved for emergency use and several others appear increasingly likely to get approved. Global vaccine distribution activities are currently underway, and this should allow the world to slowly return to pre-pandemic activities. Before then, immense stimulus measures launched primarily in developed nations should support global economic activities until the public health crisis … Read more

There Is Milk At The Store

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This article first appeared in the September edition of the High Yield Dividend Newsletter. For more information about this publication, please see here. “Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.” — Winston Churchill By Brian Nelson, CFA Very few of us could have imagined that we’d witness the bull market that began on that fateful day in March 2009 that might very well mark a generational low. In 2009, major investment banks around the globe were struggling to survive, and the fallout in the mortgage markets left the banks holding paper that nobody wanted to own, let alone buy. The global financial system … Read more