MAS

Honeywell’s Aerospace Division Its Crown Jewel

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We’re huge fans of Honeywell. The company’s Aero operations are its crown jewel, and while Boeing is facing some troubles these days, we don’t expect much impact on Honeywell at all. In fact, we expect commercial aerospace to remain strong, even in the face of broader industrial weakness. The risks to the company’s HBT business could be starting to mount given some concerns in commercial real estate, but management isn’t really seeing any signs of yet, pointing to only moderating growth in 2020. The SPS division, while a headwind, probably won’t be a factor next year, but it could bounce back as inventories are cleared from the channel. By Brian Nelson, CFA Honeywell (HON) has facilitated a number of changes … Read more

ICYMI: Interview with Valuentum’s President Brian M. Nelson, CFA

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Catch up with Valuentum’s President Brian M. Nelson, CFA in a recent interview with dividend growth investor Arne Magnus Lorentzen Ulland of the blog stockles. By Brian Nelson, CFA Recently, I was interviewed by Arne Magnus Lorentzen Ulland of the blog stockles. Arne is a dividend growth investor like many of you, and I sincerely hope you enjoy the interview he put together. I’m very grateful for his interest. His questions were fantastic. We discuss why and how I incorporate independence and integrity into the service at Valuentum. We go into detail regarding why Valuentum views stocks the way it does, and how Valuentum combines enterprise valuation and the information contained in prices in its stock-selection process. I discuss the pitfalls … Read more

Home Depot, Lowe’s Largely Unfazed By Lumber Price Deflation

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Image Source: Mike Mozart The home improvement retailing market appears very, very healthy, and while consumers could have already taken advantage of ultra-low rates to do home repairs, additional Fed cuts certainly won’t hurt the backdrop for home improvement retailers. Home Depot and Lowe’s continue to put up solid results. By Brian Nelson, CFA On August 20, Home Depot (HD) reported decent second-quarter results, with total reported sales advancing 1.2% on a year-over-year basis thanks to solid comparable store sales expansion of 3% (3.1% in the U.S.). Net earnings came in at $3.17 per share, growing 3.9% from the same period a year ago. Though many viewed the comp performance as somewhat disappointing, management noted that it experienced “accelerating comp … Read more

RYAM: Terrible Business, Potentially Cheap Stock

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Image Source: First Quarter 2019 Financial Presentation Materials Rayonier Advanced Materials has seen better days, but has the market overreacted? We don’t think there are many businesses that have poorer industry structure, but if the company can get things back on track, normalized free cash flow indicates substantial upside potential. Commodity prices and tariffs remain big wild cards to this story, and the Valuentum investor always waits for technicals and momentum indicators to turn decidedly positive first. By Brian Nelson, CFA Rayonier Advanced Materials (RYAM) was spun out of Rayonier (RYN) a few years ago. The company is a leader “of cellulose-based technologies, including high purity cellulose specialties, a natural polymer commonly found in cell phone and computer screens, filters … Read more

Markets Swooning, Expect Extreme Volatility, Finger on Put-Option Trigger

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Image shown: We notified members December 26 that we had  moved  the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio to a “fully invested” position, from a 30% and 20% cash “weighting” at the high end of the range, respectively.  — No change to simulated newsletter portfolios…at this time.  — Hi everyone, — Hope you’re navigating these tumultuous markets well.   — If you recall, during the holiday season last year, we had moved the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio to “fully invested.” See image above (point of the arrow). Because many members were traveling and out of the office, not all were able to read the notification until a week or two after. They were … Read more

ATTN: Advisors and Planners — Disruption Is Looming

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“With the commoditization of investment advice and intense competition from robos and other more cost-efficient solutions, growth-minded advisors want to create bespoke experiences for clients.” — WealthManagement.com By Brian Nelson, CFA Hi Valuentum members, colleagues and friends, Valuentum has a large subscriber base and is one of the most successful paid subscription financial information websites launched this decade. Over the past eight years or so, individuals, financial advisors and money managers from all over the world have subscribed to our services. We pride ourselves on independence and transparency, and we’re a champion of the investor. Today, I’d like to talk directly to our financial advisor, financial planner, and professional money-manager members. You probably already heard the news yesterday: Charles Schwab, which handles … Read more

DG Newsletter Alert, Markets on a Roll! New Highs Coming?

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Image shown: We notified members December 26 that we had moved the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio to a “fully invested” position, from a 30% and 20% cash “weighting” at the high end of the range, respectively. It doesn’t look like the timing could have been much better.  Changes to Dividend Growth Newsletter portfolio Removing Novartis (NVS) -3.5%-5.5% Adding Health Care Select Sector SPDR Fund (XLV) +3.5%-5.5% By Brian Nelson, CFA The back half of 2018 was among the most exciting in Valuentum’s history. For one, we might have made one of our best “market-direction” calls since inception in practically calling the near-term bottom December 26. In hindsight, it’s clear the market had overreacted, but at the time, going to “fully … Read more

Valuentum’s Stock and Data Screens and Screeners

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Let’s go over where to find Valuentum’s stock and data screens and screeners. We believe our stock screeners are among the most robust when it comes to providing forward-looking data, and our data comes straight from our enterprise discounted cash flow models that we use to derive a company’s fair value estimate. By The Valuentum Team In late 2017, we made the decision to transition to providing an updated Excel download each week to members in order to allow them to facilitate any combination of screening criteria they want with respect to our vast amounts of data, whether it be the Valuentum Buying Index, the Dividend Cushion ratio or other. What we’ve found out the past 15 months or so … Read more

Kraft-Heinz Blows Up, More Updates!

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Image shown: The rating history of Kraft-Heinz (KHC). Valuentum members were warned in advance of this pricey equity in 2016/2017, and the VBI rating never advanced past 5 since then after registering a 1, the worst rating, on two separate occasions. Dear members, I wanted to first of all welcome our new members. There have been a lot of new ones during the past few weeks. Thank you. The buzz might be coming from the new book launch, Value Trap. If you haven’t read the book yet, please do so here. Members can get the pdf digital download today at 25% off. For new members, reading this book is simply par for the course to get a feel for how we look at … Read more

Industrials Sector Ideas — Examining the Fair Value Distribution

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Let’s have a look at some recent reports from a few of our favorite businesses in the industrials sector: Danaher, Dover, Eaton, Emerson, Illinois Tool Works, Ingersoll-Rand, Lennox, Parker-Hannifin, and Roper. [Red X denotes the company’s share price, as of the time of this writing, on the fair value distribution chart. We view shares as undervalued if the Red X is in the green, fairly valued if the Red X is in the yellow, and overvalued if the Red X is in the red. The images found below can be found on page 6 of each company’s 16-page stock report.] By Brian Nelson, CFA Danaher’s Business System Is a Key Cultural Asset On January 29, Danaher (DHR) released fourth-quarter 2018 results that came … Read more