ORCL

Oracle’s Dividend Growth Trajectory Remains Solid

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Image Source: Oracle Corporation – Financial Analyst Meeting Presentation, September 2019 By Callum Turcan On December 12, Oracle Corporation (ORCL) reported second quarter earnings for its fiscal 2020 (period ended November 30, 2019). Massive share repurchases reduced Oracle’s diluted outstanding weighted-average share count from 3,908 million in the first half of fiscal 2018 to 3,370 million in the first half of fiscal 2019. That played a key role in boosting Oracle’s EPS performance (diluted GAAP EPS was up 12% year-over-year in the first half of fiscal 2020) as its revenues were broadly flat during this period. We continue to like Oracle in our Dividend Growth Newsletter portfolio given the strength of its free cash flow profile and promising outlook. Shares … Read more

Dividend Growth Newsletter Portfolio Holding Microsoft Secures a Big Win

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Image Shown: Shares of Microsoft Corporation continue to make new highs and we think MSFT may test the upper end of our fair value range given the company’s improving growth outlook. By Callum Turcan Shares of Dividend Growth Newsletter portfolio holding Microsoft Corporation (MSFT) continue to climb higher. We think shares could test the upper end of our fair value estimate range, which currently sits at $166 per share, comfortably above where Microsoft’s stock is trading at as of this writing (~$149 per share). Recent events have augmented the company’s free cash flow potential, with an eye towards the Joint Enterprise Defense Infrastructure (‘JEDI’) contract win. Shares of MSFT yield ~1.4% as of this writing. Microsoft Wins The US Department … Read more

Dividend Growth Newsletter Portfolio Holding Microsoft Posts a Nice Quarter

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Image Source: Mike Mozart By Callum Turcan On Wednesday October 23, Dividend Growth Newsletter portfolio holding Microsoft Corporation (MSFT) reported first quarter results for fiscal 2020 (period ended September 30) after the market close that saw shares of MSFT move higher the next day. The tech giant beat consensus estimates on both the top and bottom line due to sustained momentum at its cloud offerings, with growth led by Azure and Office 365. During the first quarter, Microsoft’s Office 365 commercial monthly active users passed 200 million. We continue to like Microsoft’s free cash flow growth potential and see the firm sporting a great dividend growth trajectory given its pristine balance sheet and quality cash flow profile. Shares of MSFT yield … 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

Oracle Makes a Big Push Into the Cloud

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Image Source: Oracle Corporation – September 2019 IR Presentation By Callum Turcan On Monday October 7, Reuters reported that Oracle Corporation (ORCL) planned to hire an additional ~2,000 workers to support the tech giant’s cloud expansion strategy. These new jobs would be centered around San Francisco, Seattle, and India. As of May 31, 2019, Oracle had 136,000 full-time employees located around the world with 18,000 of those employees supporting the firm’s cloud computing division. Most importantly, Oracle plans to launch another 20 cloud regions by the end of 2020 that would complement its existing 16 cloud regions, vastly augmenting its ability to cater to international customers (and to US-based clients as well). We continue to like Oracle in our Dividend … Read more

Oracle’s Cloud Business Solid; CEO Hurd Taking Some Time Off

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Oracle’s strong Dividend Cushion ratio reflects considerable free cash flow generation in excess of cash dividends paid. Fiscal first quarter free cash flow of $5.6 billion covered cash dividends paid of $795 million more than 7 times. By Brian Nelson, CFA On September 11, Dividend Growth Newsletter portfolio holding Oracle (ORCL) posted solid fiscal first-quarter 2020 results (ends August 31), but the company’s results were overshadowed by a slight revenue miss on the top line and news that CEO Mark Hurd would take a leave of absence; we wish him a speedy return to good health. Co-CEO Safra Catz and founder Larry Ellison will cover his responsibilities while away. Oracle remains in good hands. Oracle’s total revenue advanced 2% in … Read more

Our Reports on Stocks in the Software Industry

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Structure of the Software Industry Firms that serve the mature software markets—or those consisting of basic business applications—have powerful distribution channels, large installed bases, and fortress balance sheets. These entrenched competitors benefit from significant customer switching costs, which make it nearly impossible for new entrants to gain a foothold. Participants generally benefit from high-margin license revenue and generate significant returns on investment. Still, the shift to cloud computing has created both opportunities and challenges, and the enterprise software landscape continues to evolve. We like the group. We’ve optimized our tehnology coverage. To access the reports, please select here.

Join the Conversation on the Market Plunge

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The Valuentum team shares its thoughts on the recent surge in volatility and collapse in interest rates amid a trade and currency war between two of the largest economies in the world, the US and China. No changes to the newsletter portfolios at this time. During the past few days, the US (SPY, DIA) and China (FXI, MCHI) have escalated a trade war, turning it into a currency war, the latter allowing its yuan to drop to lower levels against the U.S. dollar. The US has now labeled China a “currency manipulator,” and China has responded by suspending U.S. agricultural purchases. China is one of the largest buyers of U.S. agricultural goods. The Valuentum team builds on its previous conversation … Read more

New Highs! The December Call Has Been Well-Rewarded

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Image shown: Valuentum’s Dividend Growth Newsletter portfolio. Since inception, the newsletter portfolio has *never* had a constituent that experienced a dividend cut. We moved to weighting ranges beginning in 2018.   “The less the prudence with which others conduct their affairs, the greater the prudence with which we must conduct our own.” – Warren Buffett (2018) By Brian Nelson, CFA While others are celebrating, we know better. This market could come down upon itself like nothing else. But for now. We breathe a sigh of relief. A company, Valuentum, that emphasizes the importance of timing and then delivers on that cold December 26 day to move to all-in in the newsletter portfolios is something remarkable (see image below). We cannot go back to … 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