LVMHF

Around Retail: Aspirational Brands Battle Consumer Perception

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Summary · After positive data reads in the months of October and November, things may finally be looking up for retail spending, but the impact of discounting looms large for many in the space. There are pockets of weakness and strength. · Aspirational and luxury goods manufacturers and retailers are not only subject to the pressures of the promotional retail environment, but also are subject to additional outside forces such as tourism and brand perception. While not dead, mall traffic has been challenging. · Whether it is next-generation wearable technology, a refined online presence, a reduction in markdown allowances, or an enhanced shopping experience, luxury goods companies continue to invest for sustainable growth. Fossil and Richemont have been caught by … Read more

Coach Back on Track?

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Coach (COH) has been somewhat of a black mark on the “hit rate,” or percentage of ideas outperforming the broad market return, in the Dividend Growth Newsletter portfolio, and while we continue to encourage readers to evaluate the weightings we ascribe to positions in the newsletter portfolios for insight on our level of conviction, that Coach resides in there at all means it had been one of our top ideas, added September 19, 2014 at $37.55. Coach currently yields ~4.5%. When we first added Coach to the Dividend Growth Newsletter portfolio, we were aware of the fashion risks and the troubling signs in its North American women’s handbag business. What we liked most about the company, however, was its fantastic … Read more

The Flight to Safety

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Image Source: Pravine Chester It’s no secret that investors have been disappointed with returns across the equity market in 2015, and this week has not made the unrest any easier to deal with. Money managers across the globe will be looking at a short-term chart of the S&P 500 (SPY), observing that the broad US index has finally broken down from a critical multi-month base, and many will look to “lighten up” on some of their equity positions that they have been reluctantly “letting run” for months. It is no surprise to us why Netflix (NFLX) was one of the market’s worst performers in Thursday’s trading session. The company is trading at nearly 500 times earnings (not a typo), and the low … Read more

Is The Time Ripe to Pick Up Kors?

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You just can’t buy cheap stocks, and hope and pray things will work out. You know this! Not you personally — you know, the universal you.  The fundamental framework of the Valuentum Buying Index protects you from falling knives. It requires stocks to be both underpriced and “going up” before we would consider them. Yes, we can talk castles, moats, dividends, and anything else you’d like. But the VBI is the essence of our teachings. It’s the culmination of all research and analysis. We’re not kidding. Name it. It’s in there. The best stocks will be ones that are underpriced on a whole variety of different metrics and are also experiencing buying action or accumulation, as revealed by an upward … Read more

4 Opportunistic Stocks To Consider Buying in 2015

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The Valuentum Buying Index (VBI) is a philosophy that considers the valuation of a company and the likelihood that a company’s stock will converge to a cash-flow derived fair value estimate. The VBI accepts the view that value is based on the sum of a company’s future expected discounted free cash flows and the excess cash on its balance sheet, while acknowledging that market participants must eventually agree with a firm’s underpricing (and buy the stock) in order to drive the stock’s price to fair value. An underpriced stock with no buying support is not poised to generate good returns, nor is an overpriced stock with good momentum as it will eventually succumb to panic selling once euphoria fades. Stocks … Read more

Merger Talk: Coach May Be In Play

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With interest rates at lows, the equity markets at all-time highs, and executive teams looking for strategic and opportunistic growth opportunities, the table is set for some wheeling and dealing, in our view. We think Coach (COH), the aspirational maker of handbag and accessories, is on the radar of a number of suitors, the most likely being LVMH Moet Hennessy (LVMHF), according to Prime Retailer: LVMH groups representatives have recently shown interest in Coach, sources say. Recent shows and fashion line has appealed to the design team of LVMH, one of the persons admits. It could be the turnaround that attracts LVMH – turning its attention from classical high end luxury accessories label to full RTW apparel lineup. There are … 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

Tiffany and Nike Disappoint in China

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Valuentum previously outlined the importance of brand strength in its comprehensive piece: “Valuentum’s Comprehensive Report on Retail Brands.” This article will focus on Tiffany’s (TIF) and Nike’s (NKE) performance in the Asia-Pacific, and where applicable, China, a country that we believe is vital for long-term expansion and to support our fair value estimates of both firms. Recent reports have put a damper on the outlook for luxury spending in China during 2014. Though the outlook is consistent with data points we’ve received with respect to slowing, but still robust, economic expansion in China, the commentary is worth nothing: Wealthy Chinese are likely to buy fewer luxury goods again this year after the steepest cut-back on spending in at least five … 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

How to Think About Corporate Tax Reform

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