NLOK

Our Thoughts on Intel’s Latest Earnings Report

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Image Shown: An overview of Intel Corporation’s performance during the first nine months of fiscal 2020. Image Source: Intel Corporation – Third Quarter of Fiscal 2020 IR Earnings Presentation By Callum Turcan On October 22, Intel Corporation (INTC) reported third quarter fiscal 2020 earnings (period ended September 26, 2020) that largely matched consensus expectations. Intel boosted its full-year outlook for fiscal 2020 on a net basis (which included an increase in its expected free cash flows this fiscal year) during its latest earnings update, though management reduced its forecast for Intel’s expected operating margins versus previous expectations. We continue to like Intel’s ability to generate sizable free cash flows, though we are concerned with its rising net debt load of … Read more

Our Thoughts on Intel’s Big Divestiture Ahead of Its Earnings Report

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Image Source: Intel Corporation – Second Quarter of Fiscal 2020 IR Earnings Presentation By Callum Turcan On October 20, Intel Corporation (INTC) and South Korean-based SK Hynix announced a major transaction that will reshape the global NAND flash memory market. For reference, NAND flash memory is used in smartphones, personal computers, and other digital devices. Intel will receive $9.0 billion in cash that will be paid out in two phases, assuming everything goes as planned. In return, SK Hynix is receiving “Intel NAND memory and storage business, which includes the NAND SSD business, the NAND component and wafer business, and the Dalian NAND memory manufacturing facility in China” though Intel will retain its Intel Optane business, which caters to both … Read more

3 Lessons in Portfolio Management Over 10 Years

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Dear members: — We’re finally getting a pause in the rapid ascent of the markets on September 3rd. Though headlines may look scary and momentum/volatility investors could start to pile on to the downside, a modest retracement is actually a good thing. We continue to focus on the long haul with our processes, and we’re viewing the sell-off as profit taking, for the most part. — In the near term, the markets will also have to digest some speculators betting on mean reversion between “value” (cyclical) versus “growth” (secular), but we maintain the view that the value-versus-growth conversation is largely nonsense (see block quotes below), and mean reversion is something akin to the gamblers’ fallacy, in my humble opinion. Investors should also continue … Read more

Broadcom’s Financials Are Stabilizing

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Image Source: Broadcom Inc – June 2020 IR Presentation By Callum Turcan On June 4, Broadcom Inc (AVGO) posted second quarter earnings for fiscal 2020 (period ended May 3, 2020). Shares of AVGO are trading in the upper bound of our fair value estimate range and appear reasonably priced as of this writing considering the relatively favorable forward-guidance management offered for the fiscal third quarter. Though the ongoing coronavirus (‘COVID-19’) pandemic is negatively impacting Broadcom’s operations with an eye towards “challenges” at the firm’s supply chain, the company’s growing ‘Infrastructure software’ segment appears to be helping stabilize its financial performance. We give Broadcom a Dividend Cushion ratio of 1.0, earning the firm a “GOOD” Dividend Safety rating (these metrics factor … Read more

Valuentum Exclusive Success Rates Trump Even the Best Quant Hedge Funds

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Image: President of Investment Research Brian Nelson, CFA By Brian Nelson, CFA A new book, “The Man Who Solved the Market,” hit bookshelves last year, and thus far it has been a hit. The text goes into the story of quant hedge fund Renaissance Technologies and its hedge fund, the Medallion Fund, which has put up mammoth returns since inception. Though the book focuses more on the life and times of founder Jim Simons and dedicated only a page or two to the fall of Long-Term Capital Management (LTCM), another quant fund that went belly-up during the late 1990s, it was nonetheless a thoroughly interesting and enjoyable read. But why I am bringing up one of the most successful quant … Read more

As Expected, Broadcom’s Organic Revenues Didn’t Grow in Fiscal 2019

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Image Source: Broadcom Inc – November 2019 IR Presentation By Callum Turcan On December 12, Broadcom Inc (AVGO) reported fourth quarter earnings for its fiscal 2019 (period ended November 3, 2019). While GAAP revenues for the full fiscal year were up 8% year-over-year, hitting $22.6 billion, please note that includes the uplift from Broadcom acquiring CA Technologies. Shares of AVGO initially traded down 2%-3% on December 13, as investors digested the firm’s guidance for fiscal 2020. As of this writing, shares of AVGO yield 3.4%. Overview of Recent Events Management expects the company’s revenues in fiscal 2020 will come in at ~$25.0 billion (give or take $0.5 billion in either direction) while Broadcom’s adjusted EBITDA is forecasted at ~$13.75 billion … Read more

Microsoft Soars, Strong Revenue Growth Continues Unabated

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Image Shown: Microsoft Corporation put up a solid fiscal third quarter earnings report and we continue to be big fans of the name. Image Source: Microsoft Corporation – Power Point Earnings Presentation Covering the Third Quarter of Fiscal 2022 By Callum Turcan On April 26, Microsoft Corporation (MSFT) reported third quarter earnings for fiscal 2022 (period ended March 31, 2022) that beat both consensus top- and bottom-line estimates. Shares of MSFT jumped higher by ~4%-5% in afterhours trading on April 26 as investors cheered on the good news and its promising near term outlook. Microsoft’s cloud-oriented products and services were a bright spot in the fiscal third quarter and underpinned its impressive pricing power. The firm was able to stay … Read more

Our Thoughts on the Widespread Launch of 5G Services

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Image Shown: The evolution of wireless networks and telecommunications technology over the years. Image Source: Intel Corporation – November 2019 State of 5G Presentation  By Callum Turcan The rollout of 5G telecommunication networks is upon us and we want to draw our members’ attention to some of the key companies with meaningful exposure to this space. Many are excited about what opportunities 5G technology could enable. Background On July 23, AT&T Inc (T) announced its 5G network in the US was operational nationwide and that effective August 7, both consumers and businesses with certain packages would have 5G access “at no additional cost” which included customers with AT&T Unlimited Starter, Extra, Elite, AT&T Business Unlimited Web-Only and Starter wireless plans. … Read more

Valuentum: Now Bearish, We’ve Been Here Every Step of the Way

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Valuentum Has Been Here Every Step of the Way   From the COVID-19 top in February 2020 to the COVID-19 bottom to the massive bull run through the end of 2021, we’ve been here for you.    2022 started out to be a rough year, catching many by surprise.   But Valuentum stayed positive. When the markets headed south in June, Valuentum stood its ground. On June 14, Valuentum said that “we still believe stocks could make a “huge rebound” in the near term.   We reiterated our views a few days later and on June 19, we said that “investors shouldn’t panic during this bear market” and that “stocks remain an attractive proposition at the moment and a very attractive consideration … 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