MCHI

Nike’s Digital Strategy Supports Its Future Revenue Growth and Margin Expansion Prospects

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Image Shown: Since announcing the launch of its Consumer Direct Offense initiative in June 2017, Nike Inc has done a stellar job building its omni-channel selling capabilities. The company’s digitally-oriented direct-to-consumer strategy offers it the opportunity to enhance both its long-term revenue growth outlook and operating margin expansion potential. On March 18, Nike reported mixed earnings though its near-term guidance indicates its financial performance will continue to rebound after taking a beating from the COVID-19 pandemic. As of this writing, shares of NKE are trading in the upper bound of our fair value estimate range, indicating shares are roughly fairly valued at this time. By Callum Turcan The coronavirus (‘COVID-19’) pandemic has made it clear that companies with strong omni-channel … Read more

Roblox Goes Public; Strong Balance Sheet and Expected Free Cash Flow

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Image Source: Roblox Corporation – S-1/A SEC Filing Executive Summary: Roblox Corporation recently went public through a direct listing on March 10, 2021. The video game platform company has an extensive growth runway with multiple avenues to further expand its business. We are impressed with its free cash flow generating abilities, pristine balance sheet, and strong growth rates of late. Roblox’s outlook for 2021 indicates its growth story is expected to continue this year in earnest. Capital appreciation seeking investors should take a deeper look at Roblox, though we caution that its co-founder, CEO, and chairman controls most of the company’s voting power. By Callum Turcan 2021 is already shaping up to be a huge year for initial public offerings … Read more

Starbucks Expects to Recover in Fiscal 2021

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By Callum Turcan On January 26, Starbucks Corporation (SBUX) reported first quarter earnings for fiscal 2021 (period ended December 27, 2020) that saw the firm miss consensus top-line estimates but beat consensus bottom-line estimates. The ongoing coronavirus (‘COVID-19’) pandemic has weighed negatively on Starbucks’ performance of late, as its GAAP revenues fell by 5% and its GAAP operating income tanked by 25% on a year-over-year basis last fiscal quarter. Leaning on its digital presence and drive-through operations have helped to a degree, but the reduction in the number of workers commuting worldwide (especially in the US) is clearly taking a toll on its business, as is the decline in vacation and business travel. Shares of SBUX yield ~1.8% as of … Read more

Boeing’s Financials Are Absolutely Frightening

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By Brian Nelson, CFA On November 18, 2020, Boeing (BA) announced that the US Federal Aviation Administration (FAA) withdrew its order that had grounded its 737-8s and 737-9s (737 MAX) that had been involved in two terrible accidents during the past few years, a Lion Air flight that killed 189 people and an Ethiopian Airlines jet crash that claimed the lives of 157 more. We’ll never forget these tragedies and the impact on the families and the aviation industry, more generally.   In January 2017, we had added Boeing to the Dividend Growth Newsletter portfolio, but we had removed it March 16, 2018, prior to the unfortunate and high-profile accidents that occurred several months after. During the short time it … Read more

General Motors Playing Catch Up

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Image: Hummer EV. According to General Motors’ website, the Hummer EV will be a “zero emissions, zero limits all-electric supertruck.” By Brian Nelson, CFA Most of the headlines focused on General Motors (GM) the past couple months had to do with its relationship with flailing electric heavy truck maker Nikola (NKLA). With GM’s executive suite largely distracted from the goings on at Nikola, Tesla (TSLA) has quietly changed the game in the bread-and-butter pickup heavy duty pickup truck market with last year’s launch of the company’s Cybertruck (view the unveil here). Investors will be hearing more about the Cybertruck soon. From our perspective, General Motors is playing catch up. It took Tesla’s successful launch of the Cybertruck in November 2019 … Read more

Newmont Posts a Stellar Earnings Report, Raises Dividend

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Image Shown: An overview of Newmont Corporation’s recent accomplishments. Image Source: Newmont Corporation – Third Quarter of 2020 IR Earnings Presentation By Callum Turcan Shares of Newmont Corporation (NEM) are included in the Dividend Growth Newsletter portfolio because we view its long-term dividend growth trajectory quite favorably, and the gold miner has not disappointed. At the start of 2020, Newmont significantly increased its quarterly dividend as we covered in this article here. Due to a combination of its enlarged dividend, very promising growth outlook, sizable expected synergies from its 2019 acquisition of Goldcorp, and its stellar cash flow profile, we added shares of NEM as a holding to our Dividend Growth Newsletter portfolio on January 13, 2020 (link here). As … Read more

Our Thoughts on Newmont’s Bright Outlook

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Image Shown: Newmont Corporation’s gold reserves are extensive and should support the gold miner’s ability to generate meaningful cash flows over the years and decades to come. Image Source: Newmont Corporation – August 2020 IR Presentation By Callum Turcan Back on January 13, we added shares of gold miner Newmont Corporation (NEM) as a holding to the Dividend Growth Newsletter portfolio (link here). In July, we significantly increased our fair value estimate for Newmont and please note the top end of our fair value estimate range sits at $72 per share of NEM (Newmont’s 16-page Stock Report can be accessed here). We will cover why we boosted our fair value estimate in just a moment. As of this writing, shares … Read more

Alibaba Mirrors the Performance of Its Western Peers

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Image Shown: Alibaba Group Holding Limited posted strong results for the fiscal quarter ended June 30, 2020, mirroring the performance of its large-cap tech peers based in Western countries (particularly the US). Image Source: Alibaba Group Holding Limited – June Quarter 2020 Earnings Presentation By Callum Turcan At a time when US-China geopolitical tensions are rising and the Trump Administration is pushing the Chinese tech firm ByteDance to divest (at least) the US-based operations of TikTok, many Chinese tech firms are still thriving. The ongoing coronavirus (‘COVID-19’) pandemic has fundamentally altered daily life for most households around the world. Social distancing practices have aggressively driven up e-commerce demand along with demand for cloud computing offerings (as more employees work from … 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

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