KMI

5 Shocking Stock Market Predictions for 2017

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Image Source: Claudia Dea  Valuentum: 2017 Is the Year of Evangeline Adams By Brian Nelson, CFA “Entrepreneurs are never satisfied. They want to do things better. They strive for perfection and use all the ingenuity to their command to achieve it.” – J.W. Marriott My Inbox Was Overflowing with Kindness Your positive replies to my last email, “Words Cannot Express How I Feel” were simply incredible. My inbox was flooded with so many emails, so many kind words. There were so many that I’m still working through them. If you haven’t received a personal reply, plan on getting one. You’re very important to me. It’s quite possible that I may very well be the luckiest man to have such wonderful … Read more

Image: Returns Following the Trump Victory

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To download the table for easier viewing, please select the link . Financials: Trump’s Treasury Secretary choice Steven Mnuchin wants to repeal most of the burdensome Dodd-Frank legislation. A steepening yield curve is helping banks and may drive improved net interest margins in coming periods. Goldman Sachs is ripping higher, leading the Dow’s charge.   Crude Oil: The world is moving to a better balance in supply/demand dynamics in the energy markets. OPEC is talking, has agreed to cuts, and expectations for improved economic growth are helping energy resource pricing. High-beta companies such as Continental Resources are rallying hard.   Energy: Capital spending cuts are bolstering free cash flow in the upstream space as energy resource pricing improves. Reduced regulations could help … Read more

Podcast: Markets In Motion

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The Valuentum analyst team covers market moving information that is top of mind from consumer staples valuations, the political election cycle, utility valuations, energy resource pricing, biotech considerations, Brexit uncertainty and beyond. ~8 minutes. Tickerized for several consumer staples entities and ETFs, several companies in the energy sector, emerging market vehicles and more.

Taxes and the Distressed MLP Investor

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Image show above: Performance of the Alerian MLP ETF. “Perhaps the worst thing about MLPs is that investors can spend more time doing and thinking about tax-related items than actually evaluating the businesses of the underlying entities. This could result in poor investment decisions.” – Brian Nelson, CFA By Brian Nelson, CFA What a sensitive topic for many… Our team presented at the Chicago chapter of the American Association of Individual Investors (AAII) last weekend. It is always an honor and a privilege to have the opportunity to present to such wonderful people! They ask so many great questions. (By the way, I’m working on my schedule for 2017, so if you’d like our team to speak on a topic … Read more

Are MLP Structures Phony?

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“What the parent has done in this example is financially engineer the future distribution stream and capital structure of a brand new distribution-paying entity with effectively no new capital or assets at all. The parent is just standing behind the subsidiary reinforcing its investment-grade borrowing capacity, which supports the distribution that supports the equity price, which provides incremental equity capital that can also be used to support the distribution and so on.” — Brian Nelson, CFA By Brian Nelson, CFA Using a hypothetical example of an MLP and its parent, let’s explain how MLP stock value can essentially be created from “nothing.” The following example is purely hypothetical and for educational purposes only. Let’s say the parent holds a pristine … Read more

Is OPEC For Real This Time?

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By Kris Rosemann On September 28, the Organization of the Petroleum Exporting Countries (OPEC) reached an agreement to cut crude oil production levels for the first time since 2008. The cartel reportedly agreed to limit production of member nations to a range of 32.5-33 million barrels per day (bpd) while leaders met at the International Energy Forum in Algiers, Algeria. As would be expected following such news, the price of crude oil has bounced, bringing market sentiment surrounding energy-related stocks higher along with it. The proposed production could be a reduction of up to 750,000 bpd from OPEC production levels in the month of August, but how the group of nations will reach such a production cut has yet to … Read more

The Quiet Analyst Speaks

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Image Description and Source: Mailslot for Cantor Fitzgerald, on the top floors of the WTC. The mailslot was located in a post office near the WTC site. The mailslots are with the Smithsonian Institution. Travis Wise. It’s 9pm Sunday, September 11, 2016. The day is a somber one. The 15th year passing of the tragic events of 9/11 were on everyone’s minds, and I can’t help but think specifically of Cantor Fitzgerald. The financial services company’s headquarters were on the 101st-105th floors of One World Trade Center, just a few floors above the impact zone of one of the hijacked airplanes. The firm lost 658 employees, over two thirds of its workforce, more than “any of the other World Trade … Read more

We Care: Perspective Is Reality

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Perspective is so important. Let’s talk about two of our calls recently, and how we look at them. Feel free to comment. Microsoft (MSFT): A Double Since It Was Added To the Dividend Growth Newsletter Portfolio Possible Perspective: “I admire your cajones for taking credit for unloading MSFT at ~$50/share 5 weeks before running up 12%. We all make bad calls. What I would expect, especially from a professional, is to admit a mistake and explain the error in your thought process so that we can all learn. Instead, you tout this obvious incorrect call as somehow correct? This gives me great pause in following your advise [sic] in future.” Kinder Morgan (KMI): One of the Best High-Profile Round Trip … Read more

Best Idea Kinder Morgan Working To Solve Debt Problem

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Image Source: Benson Kua By The Valuentum Team Kinder Morgan is on its way to righting its debt problems, and we love it! When the US government seemingly raises the so-called debt ceiling every few months, how can the public view towards massive leverage and effectively being unable to repay future obligations without making significant changes hold a stigma? In many ways, it has now become “okay” to be buried under mountains of debt. Is it now the norm? Each citizen in the US, for example, owns a piece of its country’s $19.3 trillion national debt, amounting to a whopping $60,000 per person, and this number is growing. That means that each new baby born in America is saddled with … Read more