PAA

In The Name of Our Independence and Integrity…For Goodness Sake

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Last week, an article was published that associated us with hedge funds, questioned our integrity as honest hard-working equity analysts with years of experience, dismissed our fantastic performance track record and Brian Nelson’s Chartered Financial Analyst designation, tarnished our independence as an equity research provider, and offered another author in free form the opportunity to misinterpret our completely independent and unbiased thesis and address it in ways of their preference, belittling our entire team at Valuentum and doing irreparable harm to our brand and image, in our vew. We were willing to let it go, but then another article ran in the print edition Saturday. First, let’s address the online piece, and the print piece subsequent to this. Valuentum’s thoughts … Read more

There Is Milk At The Store

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This article first appeared in the September edition of the High Yield Dividend Newsletter. For more information about this publication, please see here. “Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.” — Winston Churchill By Brian Nelson, CFA Very few of us could have imagined that we’d witness the bull market that began on that fateful day in March 2009 that might very well mark a generational low. In 2009, major investment banks around the globe were struggling to survive, and the fallout in the mortgage markets left the banks holding paper that nobody wanted to own, let alone buy. The global financial system … Read more

ExxonMobil’s Great Earnings Report and Promising Growth Outlook

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Image Shown: An overview of ExxonMobil Corporation’s strategy to generate shareholder value going forward. Image Source: ExxonMobil Corporation – Second Quarter of 2021 Earnings IR Presentation By Callum Turcan We added shares of ExxonMobil Corporation (XOM) as an idea to both the Best Ideas Newsletter and Dividend Growth Newsletter portfolios back on June 27 (link here) to gain greater exposure to the ongoing recovery in the global energy complex. On a day-to-day, month-to-month basis, raw energy resources pricing (crude oil, natural gas, and natural gas liquids) will bounce around (commodity prices are inherently volatile). However, what we have been interested in the most is the sharp recovery seen in raw energy resources pricing since the start of 2021. That includes … Read more

Midstreams Going C-Corp, Should SEC Disallow the Measure Distributable Cash Flow?

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Key Takeaways It’s important to differentiate the concept of enterprise free cash flow valuation and the idea of capital-market dependence. The uncertainty of the MLP business model remains, as it is clear operators are shunning the MLP business model preferring C-Corps instead. According to work from Global X Funds, now 40% of the energy infrastructure market cap consists of C-Corps, up considerably from just 15% at the end of 2014. Though many simplifications have come with implied distribution cuts, the primary reason for the rise in C-Corps across the midstream space has been the rationalizing of excess MLP valuations to enterprise free cash flow assessments. We encourage the SEC to consider disallowing the use of distributable cash flow, as it … Read more